Bitcoin could plunge 50% near-term, Guggenheim’s Scott Minerd warns

Guggenheim Partners’ Scott Minerd stays long-term bullish on bitcoin, however stated Wednesday the world’s largest cryptocurrency has run too far, too quick.

“Given the huge transfer we have had in bitcoin over the brief run, issues are very frothy, and I feel we’ll need to have a serious correction in bitcoin,” the agency’s world chief funding officer advised CNBC’s “Worldwide Exchange.”

Bitcoin traded just below $55,000 per token Wednesday morning, one week after setting an all-time excessive of almost $65,000 within the run-up to crypto change Coinbase’s blockbuster direct itemizing.

“I feel we could pull again to $20,000 to $30,000 on bitcoin, which might be a 50% decline, however the fascinating factor about bitcoin is we have seen these sorts of declines earlier than,” Minerd stated. However, he stated he thinks it is a part of “the traditional evolution in what’s a longer-term bull market,” with bitcoin costs finally reaching between $400,000 to $600,000 per unit.

Minerd turned heads late final yr when he first shared his long-range value goal for bitcoin, citing its inherent shortage — solely 21 million bitcoins will ever be created — and its worth relative to property equivalent to gold. Those remarks in December fell on the identical day the digital foreign money eclipsed $20,000 for the primary time ever.

Bitcoin has continued its huge rally that started in 2020, advancing nearly 90% thus far this yr. Institutional adoption has been cited as one issue fueling its rise. Some firms like Tesla invested a portion of their money holdings in bitcoin, and monetary companies from Mastercard to Goldman Sachs are making strikes round crypto.

The tempo of bitcoin’s ascent has nervous even some crypto bulls like Minerd, who additionally warned of a short-term pullback earlier this yr. Some crypto bears proceed to argue bitcoin is in a bubble that can finally burst.

Bill Miller, the longtime worth investor who has owned bitcoin for years, advised CNBC on Tuesday he is not involved concerning the digital foreign money being in a bubble like in 2017, when it reached what was then a document excessive of almost $20,000. Bitcoin went on to fall sharply within the following months, dropping about 80% of its worth in what’s change into often called the “crypto winter.”

“Supply [of bitcoin] is rising 2% a yr and demand is rising sooner. That’s all you really want to know, and which means it is going larger,” Miller stated in an interview on CNBC’s “The Exchange.” It might not be a straight march to the upside, although, as a result of “with bitcoin, volatility is the value you pay for efficiency,” he added.

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