As investors agonize over bitcoin's repeated attempts to break the $30,000 mark, a top executive at a major U.S. money management firm has made an even more alarming prediction.
Scott Minerd, guggenheim's chief investment officer, said on Monday he expects bitcoin to fall further to $8,000, CNBC reported. That would leave bitcoin down more than 70% from its early Monday breach of $30,000.
Minerd told CNBC on Monday at the World Economic Forum in Davos, Switzerland:
When bitcoin consistently falls below $30,000, $8,000 is the ultimate floor. So I think there is more downside, especially after the Fed's restrictions (rate hikes & tighter monetary policy).
If bitcoin's next move does what Minerd predicts, it will cause more pain for the cryptocurrency market. About $500bn has been wiped off the cryptocurrency market in the past month, with Bitcoin down about 24 per cent.
Minerd also argues that most cryptocurrencies are "junk". Bitcoin and Ethereum, by contrast, are here to stay, but he still adds:
I don't think we've seen a dominant player in crypto yet.
He further states that money needs to have store value and be able to be a measure of value and a means of circulation:
But none of these functions have been achieved.
He added that additional technological advances could change that and help create an ecosystem where people get used to using cryptocurrencies for transactions and trust them to hold their value.
Minerd also compares the current situation to the dotcom bubble of the early 2000s:
If we were sitting in the dot-com bubble, would we be talking about how Yahoo and AOL became the biggest winners...... We can't tell you whether Amazon or Pets.com will be a winner.