Bitcoin has become one of the world’s most widely held assets, and a former New York Stock Exchange (NYSE) president says it deserves a place in many investment portfolios.
Thomas Farley, former president of the New York Stock Exchange and current CEO of Far Point Acquisition Corp, told CNBC’s Squawk Box that he believes Bitcoin should be considered for portfolio allocation.
As the market leader among cryptocurrencies, Bitcoin has seen widespread adoption and intense price movement over recent years.
Farley noted that when Bitcoin traded near $60,000 many institutional investors hesitated despite interest. He explained:
“When Bitcoin was at $60,000, you had a lot of institutions on the sideline who were looking and saying, ‘we’d like to invest. We’d like to allocate 1% to 3% of our portfolios, pension funds, for example, but it’s $60,000. It feels toppy, there’s some mania.’ But they’ve done the diligence. They’ve met with their investment committees. And so, as it went down to $17,000, it wasn’t a shock to me that you saw some of those institutions stepping in for the very first time buy Bitcoin for their portfolio.”
Volatility remains a major concern for institutions considering crypto exposure. Farley attributed recent market moves to a mix of long-term, experienced Bitcoin holders and newer institutional buyers:
“I think it is a combination of some really smart Bitcoin whales that have been in it for 10 years, and then fairly quickly, some of those institutions stepping in — that’s exactly what’s happened. Bitcoin is up 40%. That doesn’t mean it’s going to go up another 40%. But in crypto, there’s Bitcoin. And then there’s literally everything else. Bitcoin is trusted. It’s largely censorship-resistant. There will only and ever be 21 million Bitcoin. It will have to be a component in broad portfolios, like a pension fund. Maybe just to a small extent, but it will have to be there.”
Farley also weighed in on other digital assets, singling out Ethereum as occupying a distinct position in the market. He contrasted Ethereum and stablecoins with the broader field of speculative tokens:
“Then there are all other cryptocurrencies. Ethereum is in a special class of its own. Then there are stablecoins, and everything else looks like a speculative stock. Maybe if you invest in it you make money, maybe you lose all of your money.”
At the time of his comments, Bitcoin was trading above $24,000 per coin, after slipping more than 2% in the prior 24 hours. While price swings can be dramatic, Farley’s remarks reflect a growing sentiment among some market veterans that a modest allocation to Bitcoin can play a role in diversified investment strategies.