Bitcoin’s recent slide below $70,000 has puzzled investors who expected strong macro conditions to support higher prices.
Interest rates have been falling, liquidity has improved, and traditional markets have pushed toward record highs. Yet Bitcoin has moved in the opposite direction.
During a recent interview with TheStreet Roundtable discussion, Jeff Dorman, chief investment officer at Arca, said the disconnect stems from a flawed assumption about what Bitcoin actually represents.
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What purpose does Bitcoin serve?
Rather than viewing Bitcoin as a traditional macro hedge, Dorman suggested it functions more as a narrative driven asset without a clear valuation model.
“Every time someone asks me about Bitcoin, it’s like asking a long short equity manager what their opinion is on gold,” Dorman said. “We spend most of our time focused on projects that have real cash flows, real fundamentals, and real tokenomics and actually accrue economic value versus Bitcoin, which is largely a narrative construct.”
That lack of a framework makes price action difficult to interpret. According to Dorman, Bitcoin works the same as a payment technology regardless of price.
“Bitcoin as a payment technology works just as well at ten thousand dollars as it does at one hundred thousand or a million,” he said.
Without a model for what Bitcoin should be worth, investors are left guessing.
Dorman framed Bitcoin less as digital gold and more as a hedge against systemic risk. In his view, Bitcoin behaves like a form of insurance against failures in banks or governments. It should perform best during periods of banking stress, capital controls, or inflationary crises.
“You want to own it when you hear about local banks and local governments,” he said, pointing to its censorship resistant nature.
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By that logic, the last several months should have been supportive. The market has absorbed government shutdowns, falling rates , and abundant liquidity.
“That’s the perfect storm for Bitcoin,” Dorman said. “And if Bitcoin doesn’t do well in that environment, it’s not good.”
The disappointment, he argued, helps explain why selling pressure can accelerate during downturns. If Bitcoin fails to behave the way its strongest advocates claim, confidence erodes.
“You’ve got an entire industry that’s painted Bitcoin as this amazing macro gold like asset,” he said. “And it’s not behaving that way.”
Ultimately, Dorman said the current drawdown reflects uncertainty rather than a clear signal. Without consensus on Bitcoin’s role or valuation, price targets become guesswork.
“It’s finger in the air,” he said. “I don’t think there’s anybody out there who really knows what Bitcoin should be trading at at any given time.”
At press time, Bitcoin was trading at $69,900.
This story was originally published by TheStreet on Feb 6, 2026, where it first appeared in the MARKETS section. Add TheStreet as a Preferred Source by clicking here.
