Cathie Wood, the founder of Ark Investment Management, said at the Consensus 2021 event that Bitcoin, which is down up to 40% from its all-time high, has come under pressure from institutional investors concerned about its environmental profile. Regardless of these concerns, she remains ever confident in the future of Bitcoin, which she described as the first rules-based “global monetary system in the world.”
Wood recently gave a forecast that Bitcoin will go to $500,000 in an interview she had with Bloomberg when the cryptocurrency market dipped close to 60%.
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She stated: “It was precipitated by the ESG [environmental, social and governance] movement and this notion, which was exacerbated by Elon Musk, that there are some real environmental problems with the mining of Bitcoin. A lot of institutional buying went on pause.”
Elon Musk, who boosted investors’ confidence by saying Tesla would buy Bitcoin for its treasury and accept it as payment for its cars, changed his mind due to environmental concerns surrounding the crypto’s energy usage. This news acted as a catalyst for last week’s market dip.
“Elon probably got a few calls from institutions,” Cathie Wood said.
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“I noticed that BlackRock is [Tesla]’s number three shareholder and Larry Fink is the CEO. He is focused on ESG and especially on climate change. I’m sure BlackRock registered some complaints and perhaps there are some very large holders in Europe who are extremely sensitive to this.”
In Cathie Wood’s Consensus appearance, she predicted central banks will begin buying crypto assets for their balance sheets and that Musk will prove positive for Bitcoin in the long term, improving its environmental profile. “He has encouraged a lot more conversation, a lot more analytical thinking. And I do believe he’s going to become a part of the process,” she said.