Longtime Bitcoin (BTC) supporter and entrepreneur Anthony Pompliano says that people in the crypto space are underestimating just how much damage has been done to the industry following the collapse of FTX and its associated entities.
Pompliano tells his 1.6 million Twitter followers that following the FTX debacle, the crypto industry as a whole is now tainted in the eyes of institutional investors.
“Based on my conversations over the last 24 hours, people are drastically underestimating how much damage has been done this week to institutional interest in both Bitcoin and the broader crypto ecosystem.
Bitcoin will not only survive, but it will thrive in the coming years in my opinion.
But we shouldn’t ignore the fact that this week was a set back for everyone, regardless of what corner of the industry you play in.“
According to Pompliano, investors have lost confidence in crypto and now “the largest capital pools in the world know the industry isn’t ready for showtime.”
However, Pompliano highlights that the loss of investor morale in the broader crypto ecosystem will push more observers into Bitcoin, drawn by its simplicity and robust architecture.
“When the confidence game is over for the crypto industry, the market comes back to Bitcoin.
There is nowhere else to flee. There is no bank run on Bitcoin. In times of chaos and uncertainty, people want confidence and security.”
He also says the bankruptcies of prominent crypto firms, including FTX and digital asset hedge fund Three Arrows Capital, will shift the focus away from price speculation and into Bitcoin’s long-term potential as a network.
“There are Bitcoin maximalists being born every minute right now. There are newly converted self-custody users popping up left and right. People are no longer asking ‘How high can X go,’ but instead asking ‘How confident am I that Bitcoin will last for Y years?’
This is a natural part of the cycle. In our darkest moment, Bitcoin steps to the forefront. It provides the solution. It solves the confidence crisis. Block after block of transactions. The digital payment network continues to provide a long-term oriented savings technology that affords anyone in the world the opportunity to protect their purchasing power over decades.”