Anthony Pompliano: ECB printing “Rocket Fuel” for Bitcoin
By Christopher Attard
Morgan Creek Digital Assets co-founder and staunch Bitcoin flag-bearer Anthony Pompliano says the European Central Bank (ECB)’s expected timid turn will be “rocket fuel” for Bitcoin.
In a tweet posted last week, Pompliano commented on a Bloomberg article that investigates the ECB’s looming policy updates — potentially including interest-rate cuts and renewed quantitative easing — designed to boost a hesitating Eurozone economy.
“ROCKET FUEL: They’re going to cut rates and print money right as we march towards the Bitcoin halving. Buckle up. This will be wild 🚀”
Notably, Pompliano had recently cited bitcoin’s halving — the reduction of mining rewards in half in May 2020 — as being one of the biggest drivers of Bitcoin’s predicted price appreciation.
His forecast is that the coin will hit $100,000 by the end of 2021.
The article cited ECB President Mario Draghi’s recent comments indicating the institution’s intent to push another round of monetary stimulus this September. The ECB head stated that “on the inflation front, we don’t like what we are seeing […] That’s very important.”
Central banks slip, Eurozone trips
The ECB president said he expects that contractions in the Euro area manufacturing could bleed into the services sector, in part due to global trade tensions. While dismissing the possibility of a large-scale recession, he stated that consumer-price growth had fallen short of the ECB’s goal of just below 2% — justifying calls for significant support.
The ECB’s Governing Council has also added a critical line to its “commitment to symmetry” statement, which according to the Bloomberg article reflects an openness to prolonged monetary easing to elevate price growth:
“The Governing Council has tasked the relevant Eurosystem Committees with examining options, including ways to reinforce its forward guidance on policy rates, mitigating measures, such as the design of a tiered system for reserve remuneration, and options for the size and composition of potential new net asset purchases.”
One Danske Bank economist told Bloomberg he anticipates 20 basis points of rate cuts from the ECB and even more quantitative easing, adding: “It’s a matter of when and how ECB will act, no longer if.”
Meanwhile, the United States Federal Reserve is expected to slash interest rates next week, while Turkey has just introduced the largest interest-rate cut since 2002. Across the globe, Australia’s central bank has also indicated its intention to continue this ease policy.
All the while, the head of global fundamental credit strategy at Deutsche Bank has said that central banks’ dovish policies are positively impacting “alternative” currencies such as bitcoin while hurting investment banks.