Bitcoin as an Emerging Market Asset

Published on
November 5th, 2020
47 minutes

Bitcoin as an Emerging Market Asset

The Interview - Crypto ·
Featuring Stephen Kelso

Published on: November 5th, 2020 • Duration: 47 minutes

Stephen Kelso, head of markets at ITI Capital, joins Ash Bennington, Real Vision senior editor, to discuss Bitcoin as an extension of the emerging market investment phenomenon. Kelso shares his wealth of knowledge gained from years of studying emerging markets and applies this to Bitcoin. He argues that Bitcoin can be seen through the EM lens because it has a greater impact on the lives of those in emerging markets than it does to those in developed markets. Kelso touches on how to apply valuation modeling to Bitcoin, how prime brokers view crypto, and where we are at in the adoption timeline of cryptocurrencies. Filmed on October 30, 2020. Key Learnings: Kelso helps break down how to approach Bitcoin as an investment through the more traditional lens of emerging markets. He explains in detail how and why investors can use the EM framework to navigate this new asset class. This gives traditional investors a well known set of tools as they invest in Bitcoin.



  • VS
    Vishal S.
    17 January 2021 @ 22:37
    Ash did a great job with guiding his questions to get at the heart of what his interviewee actually believes. Decent interview. New perspective on Bitcoin as an EM play.
  • RF
    26 November 2020 @ 18:42
    Interesting that he doesn't mention Galaxy Digital...
  • MM
    21 November 2020 @ 23:48
    "the cost to store Bitcoin is naught" :: Not really. The cost for professional custodial security service for Bitcoin is comparable to that for a high-level allocated vaulting service for Gold. I bought some Bitcoin when it was $1 as an act of revenge upon the government for its failure to hang some bankers after the global financial crisis. The failure of Mt Gox and my need for liquidity caused me to lose my nerve and I sold out at a gain which I considered lucky at the time. I shifted to gold. Fast forward to 2019 and the difficulty of moving my gold to a new country made me think maybe gold on the blockchain was viable. I made that move (specifically to the platform). Watching the exchange there where people were trading gold, silver, btc, eth, etc. 24/7 made me think, "Wouldn't it be beautiful is the price of spot gold was determined on such a worldwide publically available (i.e. available to all people regardless of wealth level) exchange instead of the LBMA or the CME?" That made the light bulb go on and I shifted my holdings in favor of bitcoin and now trade the bitcoin cycles against Gold to reduce my perceived volatility risk. Then suddenly capital gains TAXES became a huge issue. Kinesis is popular in Indonesian and there digital gold and silver are not taxed as capital holdings (a sharia law thing) so that made me jealous until I retired and was able to shift most of my bitcoin holdings under Roth IRA (into which I consolidated my 401k as well) protection for taxation. IF MUSLIM COUNTRIES CLASSIFY BITCOIN AS A MODERN VERSION OF GOLD AND EXEMPT IT FROM CAPITAL GAINS TAXATION THAT WILL MAKE HUGE WAVES. If I ran an emerging market, for example, Ecuador (which uses the USD as its currency), I would make Bitcoin legal tender and issue an Ecuadorean Central bank stable coin CBCD similar to Tether. The Central Bank could provide a secure custodial function for every citizen for both the CBCD and Bitcoin and tax trades between the two parallel national currencies as a percentage or CBCD or Bitcoin which ever it deemed most favorable to the government at any given time.
  • SW
    Steve W.
    21 November 2020 @ 08:40
    Fascinating, this is exactly the type of content RV should be seeking out - unusual takes on bitcoin not seen anywhere else. Congrats
  • CV
    Collin V.
    7 November 2020 @ 00:26
    Another gem from RV. Ash you're a natural interviewer. Great job.
    • AB
      Ash B. | Real Vision
      9 November 2020 @ 08:52
      Thanks, Collin.
  • DW
    Dean W.
    9 November 2020 @ 00:16
    Really interesting perspectives regarding emerging markets and Europe/ London/Zurich. Great answer about how to value BTC. I do hope that ESG becomes increasingly important in US going forward.
  • JF
    Jason F.
    7 November 2020 @ 21:35
    Good to hear analysis of Bitcoin from a slightly different perspective. Good interview Ash.
  • CK
    Chris K.
    7 November 2020 @ 01:49
    Wow, great hearing some new narratives on crypto
  • JV
    J V.
    6 November 2020 @ 23:17
    I appreciate the nuance from Mr. Kelso. A helpful perspective and discussion. haven't heard the EM perspective, and that combined with the real interest rates and reserve asset arguments bolsters my understanding of the long term case not with standing potential short term volatility. great questions @AshB.
  • MB
    6 November 2020 @ 19:25
    What about QBTC? How does it compare with GBTC?
  • PJ
    Peter J.
    6 November 2020 @ 18:39
    The point about BTC’s role being an EM type asset was v interesting. I’m Not sure about the continual pitching of BTC v Gold as only ‘one or the other’ is valid, but seems to be a constant theme amongst the crypto purists. On ESG, if Stephen is correct then gold mining will reduce and supply will become restricted, therefore arguably making it (gold) a scarce resource leading to a higher price? Thoughts?
  • CY
    Chris Y.
    5 November 2020 @ 23:16
    Excellent discussion. The impact of digitalization in emerging markets cannot be understated.
    • CY
      Chris Y.
      5 November 2020 @ 23:18
    • KP
      Krishna P.
      6 November 2020 @ 16:40
      Coming from a third world country i cannot agree more. Wish there is more democratization of the knowledge within the emerging and frontier nations for wider adoption and benefitting from the emerging space.
  • EC
    Edward C.
    6 November 2020 @ 15:36
    Fantastic. Loved the honesty around the Bitcoin valuation. This is what RV brings us....would never get a long form delivery like this elsewhere.
  • EF
    Edward F.
    6 November 2020 @ 10:43
    A great interview. I took from a position of instinct rather than knowledge an investment in a Kenya based crypto money transfer start up in 2016. My reasoning being that having run businesses employing many low income immigrants both in RSA and the UK there was a huge opportunity disrupting the embedded rip off money transfer companies. This interview for the first time, tied it all together for me. The investment is doing fine up 66% so far but Ash's discussion with Stephen has clarified the how and why.
  • KV
    Keld V.
    6 November 2020 @ 10:01
    I notice that many of the finance guys have great trust in Ethereum. Most progammers see it as a wild experiment, that so far has failed, and is not very likely to ever succeed with it's scaling propositions etc.
  • TW
    Tom W.
    6 November 2020 @ 08:30
    Great interview but this guy needs to accept defeat with that hairline. Just shave it off man!
  • Sp
    Scott p.
    6 November 2020 @ 06:16
    Stephan is brilliant, great interview!
  • AM
    Alexander M.
    6 November 2020 @ 00:55
    The questions are so poignant they go right to the source of knowledge.Brilliant.Thanks to both men for sharing.
    • AB
      Ash B. | Real Vision
      6 November 2020 @ 04:32
      Thank your, Alexander. The whole team appreciates it.
  • sc
    sung c.
    6 November 2020 @ 01:57
    I've been watching the order balance throughout the day on BTC. What was impressive was, as much as BTC price was moving up today, every time a larger order came up on the sell side, it was quickly sucked up by buyers and the BTC price moved right on up unfazed. I saw this all day long and it's still happening now, at time of writing and BTC price at $15,900. Been waiting all day for a correction to $13,862, where I have buy orders, but not happening yet as of this writing.
  • SH
    Simeon H.
    5 November 2020 @ 20:45
    BRILLIANT dialect. Loved it.
    • SH
      Simeon H.
      5 November 2020 @ 21:23
      "scörcity essit" :D
  • VS
    Ville S.
    5 November 2020 @ 19:07
    What's the Xetra financed ETP that he mentioned? Ticker?
    • AS
      Atul S.
      5 November 2020 @ 20:51
      BTCE on Xetra. There is a management fee but less premium than GBTC.
  • MG
    Manish G.
    5 November 2020 @ 18:25
    Brilliant interview. Quite a few unique and different perspectives presented here, which feel different and fresh from the usual macro and investment thesis.
  • VP
    Veselin P.
    5 November 2020 @ 18:15
    Very valuable interview from the frontline.