As inflation rates ease, investors in Bitcoin are reassessing their strategies, according to prominent Bitcoin entrepreneur Anthony Pompliano.

“The challenge for Bitcoin investors is whether they can continue holding their assets when inflation isn’t high on display every day,” Pompliano said during a Fox Business interview. He emphasized that Bitcoin’s appeal lies in its finite supply, contrasting it against an expanding money supply. “If more money is printed, Bitcoin’s value is expected to rise,” he remarked.

In January, the US Consumer Price Index (CPI) dropped to 2.4%, down from 2.7% in December. However, economist Mark Zandi expressed that “the actual inflation scenario may appear more favorable on paper than in real life.”

Bitcoin, often perceived as a way to hedge against inflation due to its capped supply of 21 million coins, is garnering increased interest as fiat currencies weaken.

Sentiment Behind Bitcoin Decline

Currently, the sentiment towards Bitcoin has plummeted to levels not observed since June 2022. The Crypto Fear & Greed Index recently reported a score of “Extreme Fear.” At the time of this report, Bitcoin is trading at $68,850, reflecting a 28.62% decline in value over the last 30 days.

Future Outlook for Bitcoin

Pompliano acknowledged potential short-term volatility but remained optimistic about Bitcoin’s long-term value, expecting it to become “more valuable than ever” as the US dollar might be subjected to further devaluation. He elucidated that this devaluation might not be immediately evident due to deflation masking its effects.

Pompliano projects that Federal Reserve policies will continue to stimulate the money supply in an effort to control inflation, reinforcing Bitcoin’s attractiveness as an asset in uncertain times.