Bitcoin Capital. Today we're speaking with Paolo Ardoino, the CEO of Tether and the CTO of Bitfinex and Bitfinex Securities about his outlook for 2026. Some of the topics I want to discuss with Paolo today include first and foremost obviously price and the Bitcoin cycle, looks at gold, Tether Gold and the role that hard assets play in Tether's portfolio, how the regulatory outlook has changed over the last 12 months and what to watch for the year going forward and also which jurisdictions to watch. TradFi's interest in stablecoins and tokenization and also what 2026 holds for Bitcoin treasury companies. Paolo, welcome to the show.
Hey Jesse, thank you for having me.
You bet. So, the focus of this conversation is outlook for 2026. And I think what everyone's most concerned about is price. So I think the big question is are the four-year cycles over or are they going to continue as they have before?
Right, that's a good question. So I think that there are different parameters and factors that we didn't have before. Last year was the first year that actually institutions started to join Bitcoin with ETFs. I must say that I'm seeing Bitcoin still too much correlated to the capital markets. And there is something that could technically affect Bitcoin price in the next period that is the so-called AI bubble. This concern about the fact that AI companies are spending too much money in AI infrastructure and data centers and trying to build a gazillion gigawatts of power to install GPUs and all that. So if there is a sentiment shift in the AI world that could cause some turmoil into the stock market in the United States, Bitcoin could be affected. But I think more and more there will be funds and even pension funds and governments that are very interested now in Bitcoin. So I think that there will be a base supporting force for the price that I think was not present before. So I would imagine that sharp corrections of 80% like we saw in 2022 or early 2018 might not be the case anymore.
Yeah, I think that makes sense. And then on the other side of it too, the block reward is much smaller than it's been previously. So I think the selling from the miners should have less impact and is a lot smaller than what you see coming in from the ETF flows as well.
I don't think that matters too much, the sale of the mining output as a sell pressure. I mean, we have seen recently big accounts with tens of thousands of Bitcoin dumping the market, and also even old accounts being reactivated. I think we are in a stage where the more time will pass, the liquidity will grow. I was reading that now in the US, CFTC-enabled markets can list Bitcoin spot products. So that is something that definitely continues to bring Bitcoin eventually over time at the same level of gold, basically the top two or three most liquid markets in the world. So the more the price, without being financial advice, I think that over time the price will go up and the liquidity will grow tenfold. So yeah, I think there will eventually be the coupling. Just now, with $2 trillion of market cap, Bitcoin is still too volatile because of that. The market cap is too little in a certain sense to be stable.
Yeah, last cycle, speaking of gold, I think that was kind of the thesis for a lot of the investors. Paul Tudor Jones had that line that he said Bitcoin was the fastest horse. It was like gold but would move faster. And then I remember JP Morgan had this really great title to a note. They said that Bitcoin would make gold suffer for years. And now gold is making Bitcoin suffer. Gold is outperforming Bitcoin this year. Why is gold's performance better than Bitcoin this year, do you think?
Well, I think that both the assets are hedging assets. People for the last five dozen years held gold as a hedge against, well first as money, and then more recently as a hedge against national currencies and inflation and the poor decisions of central banks. Bitcoin is considered basically digital gold. And technically should be for many preferable to gold. But the reality is that if we look around the world, only still a small portion of the world understands Bitcoin. More education is needed. Gold had a first mover advantage and stayed with us for 5,000 years. And so the knowledge of gold has been narrated across generations. We need multiple generations to understand Bitcoin at the same level of gold and have that intrinsic test of time trust that is now normally attributed to gold. So I would say that simply put, if in the next few years there was a financial reset, people would still prefer gold because people understand more easily gold. In two generations, maybe one generation, it's hard to tell, or in three or four, it's very hard to tell. I think that people will prefer Bitcoin. So it's like most of the decision makers in the world are above 50 years old and so not prone to change. There are great people that like to read and understand new things and get excited about novel technology, but the reality is that most of the people that are ruling the world and controlling wealth and taking decisions are not necessarily yet convinced by Bitcoin. But they know gold very well. The Italian prime minister, Giorgia Meloni, was in the news this week trying to repatriate the gold that Italy had stored outside of Italy. It shows that governments are starting to brace for something. And many Asian countries are buying large quantities of gold as well. If there is a fear of global instability, the clear winner for protecting from that is gold, but eventually will be Bitcoin.
Speaking of countries buying a lot of Bitcoin, I saw a chart last week that showed that Tether bought more gold in the third quarter than any central bank in the world and more than both India and China combined, which is amazing.
But wait, and then a lot of people were sending me messages like, 'Oh, it looks like gold is the new Bitcoin.' Things like that. But Tether also bought a lot of Bitcoin too. Actually bought more Bitcoin in third quarter than gold, which I don't think is as well reported. Is that correct?
So we bought 8,888.88 Bitcoin in the last quarter. We are buying both and we think for this very reason. The motto of Tether is being the stable company, and so stability we need to be intelligent about it. I prefer personally Bitcoin, but since we want to bring stability to the world, we cannot look at the world as we wish it was. We should look at the world as actually it is. So we need to protect our users and create a hedge for our users in a way that is historically correct to this exact moment in time. And this moment in time still sees gold as an important hedge. That's why if there are market turmoils, gold goes up and Bitcoin unfortunately is still tied to the stock market. Eventually it can untie itself from the stock market. But again, it's not like we are choosing between two children and saying we love one more than the other. Our major goal is to protect our users and we're trying to do it in the smartest and safest way possible, and both assets are very important for this endeavor.
