Jason Welz, Head of Digital Assets at Jaltech, discusses Bitcoin’s recent surge, attributing it partly to Trump’s re-election, which may lead to relaxed crypto regulations. Institutional interest is also driving Bitcoin’s appeal as a “trustless” asset. While optimistic, Welz advises cautious investment, suggesting a portfolio allocation of 2–5% for average investors.
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By BizNews Reporter ___STEADY_PAYWALL___
In an interview on this morning’s BizNews Briefing podcast, Jason Welz, the “crypto czar” at Jaltech, spoke with host Alec Hogg about the surge in Bitcoin’s popularity and price, particularly in the U.S., as well as the broader influence of recent political developments on cryptocurrency. Welz shared his views on the current crypto landscape, the unique appeal of Bitcoin, and investment recommendations for potential crypto investors.
The “Trump Bump” Effect on Crypto
Welz noted that Bitcoin’s recent upward trajectory can partially be attributed to the re-election of former U.S. President Donald Trump. Often referred to as the “Trump Bump,” Welz explained that Trump’s victory may lead to a friendlier regulatory environment for cryptocurrency. “The regulatory regime in the U.S. for Bitcoin is not exactly unfriendly,” he stated, citing recent legal battles between the SEC and Bitcoin ETFs, which eventually allowed Bitcoin ETFs to gain traction after favorable court rulings. However, regulations around assets deemed “securities,” like those in the decentralized finance space, are still evolving and pose a challenge for regulators and investors alike.
Welz suggested that a Trump-led administration could lead to more lenient crypto regulations, which many crypto enthusiasts see as a positive development. For Bitcoin specifically, Trump’s influence may act as a “rising tide that lifts all boats,” Welz noted. “Bitcoin is a sort of ‘gold-like’ asset, and there are other drivers behind its support.”
The Institutional Investor Shift and Bitcoin’s Newfound Legitimacy
Welz addressed the significant shift in Bitcoin’s investor profile, with more institutional investors entering the market. While Bitcoin once had a “rat poison” reputation, as Berkshire Hathaway’s Charlie Munger famously put it, Welz shared that attitudes are changing, particularly among institutional investors and pension funds. He highlighted the recent decision by a UK pension fund to allocate 3% of its holdings to Bitcoin. “This is the highest I’ve seen,” he said. “Most funds are only dipping their toes with a fraction of that allocation.”
The broader adoption by institutional investors, he argued, represents a “new paradigm in assets,” with Bitcoin’s appeal stemming from its trustless nature. Unlike gold, which has centuries of social acceptance, Bitcoin is scarce, intangible, and does not need physical storage, making it an appealing option for modern investors.
Bitcoin’s Unique Value Proposition
Welz explained why Bitcoin, as a “trustless asset,” is attracting attention despite its unconventional value proposition. Unlike traditional assets, Bitcoin’s worth doesn’t stem from its use in productive processes or its intrinsic qualities. Instead, its value is largely social, relying on a consensus about its worth rather than any practical utility. This “social premium,” Welz remarked, is what distinguishes Bitcoin from assets like oil or metals.
While the idea of digital assets can seem speculative, Welz firmly believes in Bitcoin’s staying power, underscoring that it’s not just a passing trend. “It’s definitely here to stay,” he stated, citing increasing endorsements from players across the financial industry.
Predictions and Potential Pullbacks
While bullish on Bitcoin, Welz advised caution, noting that Bitcoin’s meteoric rise may face a temporary pullback. With Bitcoin up 84% this year, Welz said, “I wouldn’t be surprised to see a little bit of a pullback.” He explained that while Trump’s policy shifts might have positive implications for Bitcoin, they could also introduce broader economic risks. For instance, Trump’s potential austerity measures or tariffs could spark a U.S. recession, which might harm Bitcoin as well as other risk assets.
However, Welz also acknowledged the unpredictable nature of the crypto market, particularly when Bitcoin reaches new highs and enters a “price discovery” phase. In these phases, he explained, it’s “anyone’s guess where prices sort of level out.”
Investment Recommendations: A Balanced Approach to Bitcoin
For those considering adding Bitcoin to their portfolios, Welz emphasized a balanced approach. While Bitcoin holds appeal as an alternative asset, he advised the average investor to limit Bitcoin exposure to between 2% and 5% of their portfolio. “For most people, anything over 2% is probably not advisable,” he said. Still, Welz admitted that more seasoned investors or those with a deep understanding of the crypto space might opt for a larger allocation.
Hogg, sharing his own experience, noted that his business portfolio had taken a geared position in Bitcoin through MicroStrategy, a company that holds substantial Bitcoin reserves. Due to MicroStrategy’s impressive performance, Hogg’s Bitcoin allocation grew from 2% to 8%, a shift that prompted him to ask Welz for his recommendation.
In response, Welz advised investors to tailor their exposure based on individual circumstances, emphasizing that younger, more risk-tolerant investors might deviate from these general guidelines. “For me personally, I’m quite young, so I break those rules of thumb quite significantly,” he shared, hinting at his own larger crypto holdings.
Bitcoin’s Future: Stability or Speculation?
Bitcoin’s price history has been marked by dramatic highs and lows, and Welz doesn’t anticipate that volatility disappearing anytime soon. Yet, he remains optimistic about Bitcoin’s role as a stable asset for the future. While he acknowledges that it might not replace traditional currencies, he sees Bitcoin as a robust store of value for investors willing to accept the associated risks.
Welz’s perspective sheds light on Bitcoin’s evolving role in the financial ecosystem, where its digital scarcity and decentralized nature distinguish it from traditional assets. With institutional interest and a potential regulatory shift in the U.S., Bitcoin seems poised to continue its growth trajectory, though likely with some bumps along the way.
Conclusion
Jason Welz’s insights underscore the growing appeal of Bitcoin in the wake of recent political shifts and institutional interest. While the path forward for crypto may be uncertain, Welz’s cautious optimism offers valuable context for investors navigating this complex landscape. As he put it, Bitcoin’s future is promising yet unpredictable—a risk-reward trade-off that, for now, continues to attract both believers and skeptics alike.
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