Experts on both sides of the fence have recently been making wild predictions of doom and glory for the future of cryptocurrencies. Let’s examine two recent bulls and two bears.
Bull. Mike Novogratz. Novogratz, a billionaire and Former Fortress hedge fund manager stated recently that he believes the crypto markets are headed for a $2 trillion dollar market cap in 2018. Back on Oct. 10, Novogratz said on CNBC’s “Fast Money” that he expects bitcoin will top $10,000 in the next six to 10 months. Bitcoin traded near $4,874 that day. He stated that Ethereum would be close to $500. Since then Bitcoin has eclipsed $10,000 and Ethereum $500. Interesting. Novogratz is raising a $500MM fund to invest in crypto and has 20-30% of his assets in crypto. It’s important to note that while Novogratz is bullish on crypto he did state it’s “the biggest bubble of our lifetime”, but that “bubbles happen around ideas that are right that actually changed the world.” (Source: CNBC).
Reasons for being bullish: “The institutionalization of this space is coming. It’s coming pretty quick.” “There’s a big wave of money coming, not just here but all around the world.”
Bull. Trace Mayer. Trace hosts the popular Bitcoin Knowledge Podcast. He started recommending Bitcoin around $0.25 and funded core blockchain infrastructure including (1) Armory which provides the foundational security for Bitcoin wallets, (2) Bitpay the largest Bitcoin merchant processor and (3) Kraken the largest Bitcoin/Euro exchange. Today, Trace tweeted, “#Bitcoin knocking on door to top-25 world currency. $10k $BTC & $168B market cap only tip of 1st root of 1st network effect of 7. Healthy uptrend. 200DMA $4,084 & rising ~$30/day. 200DMA market cap ~$67B & rising ~$500m/day. $10k/4.1k=2.44x. Onward & upward.” Clearly, a bullish tweet on the eve of Bitcoin $10K.
Bear. Warren Buffett. The CEO of Berkshire Hathaway has not spoken with frequency about Bitcoin, however he has stated that Bitcoin had no intrinsic value, undercutting its prospects as an investment. “Stay away from it. It’s a mirage, basically.” He also acknowledged Bitcoin’s technology was intriguing. “It’s a method of transmitting money,” he said. “It’s a very effective way of transmitting money and you can do it anonymously and all that. A check is a way of transmitting money, too…I hope Bitcoin becomes a better way of doing it.”
Bear. Mohamed El-Erian. The Chief economic adviser of Allianz SE while praising blockchain technology warned, “It is a disruptive technology, but the current pricing assumes massive adoption, and I don’t think that governments will allow the amount of adoption that is currently priced in.”
Ultimately, no one knows what the other side of the chart looks like. Case in point today (I’m finishing this on 11-29-17), displaying some of it’s more robust volatility, I just watched Bitcoin swing from $11K to $9K and back to 10K in about 20 minutes. Blockchain is an absolutely disruptive technology. Is already changing the world and certainly that pace will accelerate with greater adoption. The price has been volatile and will continue to be volatile, as would any emerging stock or disruptive technology, however over time that volatility will likely reduce.
If you are interested in the space, take the time to become educated. That way you can cut through the garbage news. Here are a few great resources to get started:
Here’s a much more full list of bulls and bears: https://www.bloomberg.com/features/bitcoin-bulls-bears/
P.S. We’re bulls.