Dan Morehead, founder and CEO of Pantera Capital, believes that cryptocurrency markets are undervalued in comparison to artificial intelligence stocks, which have experienced a significant surge. Speaking at a New York event, Morehead noted that the divergence between the two sectors is one of the largest he has witnessed. He stated that although AI is crucial, its current valuation seems fully priced, whereas crypto is 'incredibly cheap'.
Pantera's internal data supports this view, showing that an AI index is trading 33% above its four-year trend, while bitcoin has fallen 43% below its historical trajectory. Morehead attributed this gap to investors' enthusiasm for AI, which has led to substantial funding and rising public market valuations.
In contrast, crypto has struggled to regain momentum despite increased adoption and regulatory progress. He emphasized that most institutions lack exposure to crypto, leaving room for future demand.
Morehead also highlighted the structural cycles in crypto markets, citing the four-year cycle related to bitcoin's supply schedule. He suggested that the market may remain in a weaker phase in the near term but expressed a positive long-term outlook. Furthermore, Morehead linked crypto's appeal to broader macro trends, describing digital assets as a hedge against currency devaluation.
He also noted the convergence between AI and blockchain technologies, arguing that the two sectors are interconnected. As capital continues to flow into AI, Morehead's thesis is based on the idea that markets will eventually rebalance, drawing attention back to underpriced digital assets.