Bitcoin Whipsaws as Traders Brace for New Year Rebound

Summary

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Bloomberg Businessweek Podcast Summary

Episode: Bitcoin Whipsaws as Traders Brace for New Year Rebound
Date: December 31, 2025
Hosts: Carol Massar and Tim Stenovec
Guest: Bill Barhydt (Founder & CEO, Abra)

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Episode Overview

This episode takes a deep dive into the current state and future outlook of the cryptocurrency market, with a focus on Bitcoin’s volatility as 2025 comes to a close and 2026 approaches. Guest Bill Barhydt, CEO of Abra, provides expert insights on market dynamics, regulatory changes, investor behavior, and the anticipated role of tokenization in financial markets.

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Key Discussion Points & Insights

1. Market Parallels: 2020 vs. 2025-26

• Similarities to 2020: Barhydt draws on historical patterns, noting how recent events echo 2020’s market behavior—market crashes, asset rallies, and subsequent rotations into riskier assets.
• Asset Performance Recap:
  • Gold and silver have reached new highs in 2025 (gold near $4,500, silver around $80).
  • Bitcoin has been largely range-bound for the year, despite strong moves after the U.S. Presidential election due to anticipation of regulatory clarity.
  • Historic reference: After gold peaked in 2020, risk assets like Bitcoin experienced substantial rallies.
• 2026 Projections:
  • Predicts that 2026 could mirror 2020 with Federal Reserve rate cuts, increased liquidity, leverage relaxation in banks, greater regulatory clarity, and the introduction of additional ETFs.
  • Barhydt: “It feels like, with the Fed and other liquidity catalysts, 2020 is going to repeat itself in 2026.” (04:42)

2. Investor Activity & Platform Trends

• Rotation in Holdings:
  • Two phases: Early investors taking small profits (the "Bitcoin IPO moment"), and now, a shift of Bitcoin holdings away from exchanges to long-term storage and wealth management platforms.
  • More clients are interested in borrowing against their Bitcoin holdings, anticipating a long-term price floor and upside.
  • Barhydt: “Money coming in to a platform like ours tends to stay there for a very long time, extending stays in cold storage for a very long time.” (05:46)

3. Volatility & Investor Sentiment

• Comparative Volatility:
  • Barhydt argues that in 2025, stocks like Nvidia and Tesla have been even more volatile than Bitcoin.
  • Core Abra clients are long-term holders, largely uninterested in selling:

    “The biggest question I get is what would I possibly sell into? [Bitcoin is] the best long term, you know, capital gains potential asset that I own.” (07:28)

• Trading vs. Holding:
  • Short-term price swings are largely the result of trading activity. The circulating supply of Bitcoin on exchanges has declined, reducing volatility driven by trades.

4. Regulatory Environment & Policy Outlook

• Legislation Progress:
  • U.S. government support is evident, with the administration portrayed as crypto-friendly.
  • Stablecoin and “Genius Act” legislation has passed; anticipation for the “Clarity Act” to overhaul securities and commodities regulation.
  • Barhydt: “The Clarity act...is going to be the biggest overhaul in many ways to securities and commodities regulation in decades, which is going to make it easy...for the tokenization of everything.” (08:23)

5. Tokenization: The Next Frontier

• Tokenizing Assets:
  • The initial phase is tokenizing existing shares, but the real innovation is in native tokenized equities—assets issued directly on blockchains.
  • Key advantages:
    • 24/7 markets—unlike traditional equity markets with limited trading hours.
    • Borderless, always-on liquidity, in line with investor expectations.
    • Makes borrowing against tokenized assets as seamless as with Bitcoin, potentially without triggering capital gains taxes.
• Barhydt Explains:

  “Crypto markets don't close. So now all of a sudden you have the opportunity to have a 24/7 borderless market...that is 24/7 liquid.” (09:40)
  “[If] you've tokenized Apple shares, Tesla shares, it's now just as easy to borrow against the value of those shares without having to pay capital gains taxes as it is against Bitcoin. That is going to drive the tokenization of everything.” (10:06)

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Notable Quotes & Memorable Moments

• On Pattern Recognition:

  “History doesn’t necessarily repeat itself, but it often rhymes...a lot of this sounds familiar.”
  — Bill Barhydt (03:22)

• On Investor Behavior:

  “Our clients are long-term holders. They don’t sell...The biggest question I get is: what would I possibly sell into?”
  — Bill Barhydt (07:28)

• On Tokenization’s Promise:

  “The real value comes in native tokenized equity issuance, and that has huge advantages. Our stock markets are closed more than they're open...Crypto markets don't close.”
  — Bill Barhydt (09:24)

• On Regulatory Milestones:

  “We got the stablecoin legislation, the Genius act passed...We're about to get the Clarity act out of committee...the biggest overhaul in many ways to securities and commodities regulation in decades.”
  — Bill Barhydt (08:23)

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Timestamps for Important Segments

• [02:57] — Carol Massar introduces Bill Barhydt and sets up the crypto markets discussion
• [03:19–05:27] — Barhydt draws historical parallels, reviews 2025 asset performances, and forecasts 2026
• [05:27–06:45] — Discussion on trends in investor activity, including behavioral shifts and borrowing against holdings
• [06:45–07:49] — Insights into volatility, trader versus holder mindsets, and why long-term investors remain steadfast
• [07:52–08:23] — Examination of crypto policy and regulatory landscape in the U.S.
• [08:23–10:22] — Detailed look at tokenization, its immediate applications, and long-term implications for global markets

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Conclusion

The episode delivers an insightful look at the crypto market’s 2025 performance, the growing prevalence of long-term holding and borrowing against crypto assets, and how regulatory changes and tokenization could fundamentally reshape global finance in 2026 and beyond. Bill Barhydt's commentary bridges past trends and future possibilities, offering both practical analysis and visionary outlooks for digital assets.

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Transcript

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[Carol Massar]

Well, with more on the year that was and what may lay ahead, particularly in crypto. Now we're joined by Bill Barheit, CEO and founder of Abra, a global platform for digital asset prime services and wealth management for high net worth individuals and institutions. So if you're Abra, Bill, I'm tempted to ask when is the Cadabra coming and is it next year?

[Bill Barheit]

Good question. Good to see you. Thanks for having me. Look, there's a lot of things that, as they say, history doesn't necessarily repeat itself, but it often rhymes. There's a lot of things going on that feel like 2020 to me. We had a market crash at the beginning. Covid induced here. We had, you just brought up a crash in October which was induced by the initially the 100% tariff announcement on China, but also some serious issues that were uncovered afterwards in a one of the large exchanges internationally. And then, you know, gold rallied, right. In 2020, gold rallied from I think it was 1400 to 2000. Silver rallied from about 12 to almost 30. Bitcoin stayed in a range at that point and it's trading very close to where it started the year right now. So, you know, a lot of this sounds familiar but by the way, after gold peaked we had a rotation into risk assets in 2020 and Bitcoin went on an epic run from 12,000 to over 60,000. Right. And the market cap of the entire crypto space went up by 8x by mid 2021. So now gold is near record highs, around 4500, silver is around $80. Bitcoin is basically been sideways this year. I actually think it went up significantly after the election because it was front running. The idea that all of the regulatory obstacles to adoption were going to be removed, which has mostly true with additional legislation pending. Right. We talked about October liquidation events. So it feels like with the Fed and other liquidity catalysts, 2020 is going to repeat itself in 2026. Rate cuts, you know, leverage reserves and the banks are likely to get really relaxed which means more leverage again, regulatory clarity, ETFs, etc. Etc.

[Tim Stankavich]

Hey Bill, one thing I do wonder, I mean you guys are a platform, you see things, you see investors, what they are doing, high net worth individuals, also institutions. Talk to us about activity. More money coming in, more money going out. Give us some color on what you are seeing on your platform.

[Bill Barheit]

Sure. So I think we're seeing a rotation. There's two types of rotations we're seeing. The first is so there was a well known investor who referred to this as Bitcoin's IPO moment. And what I think he meant by that is we had people who've invested in Bitcoin 10, 12 years ago who were taking a little bit of profits, let's say 15, 20% profits. That's a lot of money because those people have massive concentrations. Their entire wealth, if you've been holding for 10 years, is probably based on Bitcoin. And so that IPO moment represented a bit of a rotation. Now we're actually seeing rotation where a significant percentage of Bitcoin is no longer being held on exchanges. So we're not an exchange, we're a wealth management platform, just like another ria. So money coming in to a platform like ours tends to stay there for a very long time, extending stays in cold storage for a very long time. Now we're seeing a lot of clients asking to be able to borrow against those Bitcoin holdings because they think that it's reached a long term floor with significant upside.

[Carol Massar]

Your customers not getting a little scared though, Bill, Because I mean it is extraordinarily volatile at the best of times. But, but just in the last three months, as we can see, we're down, you know, 25%. Sure, we're higher than we were, you know, before the President took office, but still.

[Bill Barheit]

Yeah, no, that's, that's not a, that's not, that's a trading phenomenon. Right. So in our world, first of all, Nvidia points this year was in Tesla rule were significantly more volatile than Bitcoin. I would also posit that, right. It's, it's traders that drive that price. The incremental float that's available for trading at Bitcoin is not nearly as big as it used to be because so much of it is locked up now, whether it's ETFs or in platforms like ours, our clients are long term holders. They don't sell. And the rotation of money out of our platform is nearly zero. And that's not just a function of the fact that they like our service, which I'm sure they do. It's that, you know, our clients are just not interested in selling bitcoin. The biggest question I get is what would I possibly sell into? It's, it's the best long term, you know, capital gains potential asset that I own.

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[Bill Barheit]

And they're not speculators, by and large.

[Tim Stankavich]

What's important that you see from the administration that continues the support of, of Bitcoin and other cryptocurrencies. We Certainly know we have a White House, safe to say, that is very favorable to the crypto environment. The President's family is certainly involved in it. But what is it that you expect in terms of the environment? They're still trying to figure out regulatory. There's still a long ways to go. Does that get solved in 2026, especially when you've got midterm, you know, midterms looming and maybe Congress coming back to kind of assert itself?

[Bill Barheit]

Good question. I see three things happening. The first is we're going to get a second bill passed, in my opinion. We got the stablecoin legislation, the Genius act passed, which I think was pretty reasonable. We're about to get the Clarity act out of committee, I believe, which is going to be the biggest overhaul in many ways to securities and commodities regulation in decades, which is going to make it easy for the second part of my thesis, which is the tokenization of everything. So you're going to see markets globally, including the US Start to adopt tokenized versions of equities, commodities, real estate, etc. Etc. And then the third, I think you're going to see more of the same as it relates to global and specifically US Debt markets. Right.

[Carol Massar]

See, I have a problem with this build because I wonder why replicate and why would you buy the replica when you can buy the real thing?

[Bill Barheit]

I wouldn't buy a replica. So. So that's a good question. There's a nuance there. So. So the early days of tokenization are going to be tokenizing existing shares, which adds a little bit of value, which I'll explain in a second. But the real value comes in native tokenized equity issuance, and that has huge advantages. The first is stocks. Our stock markets are closed more than they're open. Okay. Crypto markets don't close. So now all of a sudden you have the opportunity to have a 247 borderless market. Right. That is 247 liquid, which is what investors in 2025, 2026 want, in my opinion. Right. That's number one. Number two, as I mentioned, Bill just.

[Tim Stankavich]

Got about 30 seconds, so I just want to give you an opportunity to wrap up. Go ahead.

[Bill Barheit]

Yeah, sure. And then the second part leads to what I said before. What is the fastest growing service we see? It's people borrowing against the Bitcoin. If you've tokenized Apple shares, Tesla shares, it's now just as easy to borrow against the value of those shares without having to pay capital gains taxes as it is against Bitcoin. That is going to drive the tokenization of everything.

[Tim Stankavich]

We will continue this, no doubt, in 2026. Bill Barheid he's founder and CEO of Abra joining us.

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