Ark Invest Fund has been plummeting for consecutive days! Cathie Wood: Remains optimistic about the future, Bitcoin is a new asset class since the 16th century.

Ark Invest founder Cathie Wood recently participated in an online seminar hosted by the Chicago Board Options Exchange (CBOE) and MSCI, where she shared her views on the stock market and Bitcoin.

Despite participants including "Shark Tank" star investor Kevin O'Leary and VanEck CEO Jan van Eck, the opinions of the legendary investor Cathie Wood remained the focus of attention.

The Brilliant Era of Bitcoin Approaching

Despite recent pullbacks in Bitcoin, Wood believes that Bitcoin is poised to enter its brilliant era as more companies adopt crypto-friendly strategies like Tesla and Square, indicating a long-term upward trend for Bitcoin. She mentioned:

Allocating 2.5% to 6.5% of an investment portfolio to Bitcoin is very reasonable.

She also noted that Ark Invest primarily invests in cryptocurrencies through Grayscale's Bitcoin fund GBTC. However, recent reports indicate that GBTC hit a historic low premium of -14.34% on 3/25, slightly recovering to 9.74% today, showing that the trading market supply far exceeds demand.

Warning to U.S. Citizens: Avoid Reckless Bitcoin Trading

Wood also expressed a viewpoint not previously mentioned during the meeting, warning investors not to sell or trade Bitcoin recklessly before the Internal Revenue Service (IRS) implements more sensible tax policies in the U.S., as it could lead to substantial tax liabilities. She stated:

I think the IRS might have something to say about this. Assuming you've made massive gains on Bitcoin, I don't think I would take the trading risk until there are changes in tax regulations.

A New Asset Since the 16th Century: Bitcoin

During a live broadcast organized by MSCI, Wood elaborated on the value of blockchain by comparing it to the early development of the internet, highlighting the lack of payment mechanisms in the early internet and believing that blockchain will serve as the payment platform on the internet. The DeFi parallel financial ecosystem with blockchain at its core has almost taken shape, and the COVID-19 crisis has accelerated the development of DeFi.

Regarding Bitcoin, she pointed out its very low correlation with other crypto assets, leading Ark Invest to believe that Bitcoin is a new asset class since the 16th century. She expressed:

Institutional investors' involvement is a shot in the arm. What surprises us the most is companies like Tesla starting to buy Bitcoin to diversify the risk of holding cash.

Despite Ark's funds experiencing over 20% declines since mid-February, Wood remains optimistic about the future and the development of the electric vehicle market.