‘Speculative frenzy’ to die down, but $400k target still on

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In an interview with Bloomberg Markets on Friday, Scott Minerd, Chief Investment Officer of Guggenheim Partners, shared his seemingly conflicting views on Bitcoin’s potential, noting that select private Guggenheim funds have invested in the cryptocurrency.

Minerd, who oversees Guggenheim’s $ 275 billion in assets under management, called in an interview late last year for a sky-high target price of $ 400,000 on Bitcoin – slightly below the highest price predictions of any major institutional leader – but recently said in a tweet last week that the market can be overheated. The U-turn even led to playful allegations of market manipulation.

However, as Minerd said Friday, its long-term bullish price target remains intact while a bearish pullback may still be in sight.

Bitcoin’s parabolic surge is unsustainable in the short term. Vulnerable to a setback. The targeted technical upward trend of USD 35,000 was exceeded. Time to take some money off the table.

– Scott Minerd (@ScottMinerd) January 11, 2021

“One thing we see is a sudden interest in retail […] Many of the crypto outlets are overwhelmed, they start to limit orders because they cannot cope with the demand. “

One such example is eToro, which recently warned of buyer restrictions starting this weekend. Minerd noted that such strong demand could be a sign of an exaggerated rally in the short term, but the narrative winds ultimately shift in Bitcoin’s favor.

“The other side shows that crypto is becoming more and more mainstream. The $ 400.00 price I was talking about was based on the global supply of gold, and Crypto is more attractive than gold in many ways. ”

Minerd noted advantages such as portability and easy transactions with Bitcoin compared to physical gold.

When asked if Guggenheim funds have made the leap into Bitcoin, Minerd said, “I don’t think we are hit yet for any of our mutual funds.” However, the company would consider allocations if customer demand picks up.

However, he revealed that smaller private Guggenheim funds have made the leap.

“We have already bought it in some of our private funds. […] I recommended to someone that if you think it will eventually be 400,000, 2% of your portfolio will be 20% before it’s all over. “

Part of Minerd’s uptrend is rooted in long-term historical analysis. At the beginning of the interview, he noted that “we may be entering a golden age” and that “comparisons have been made with the 1920s after the Spanish influenza”.

Ultimately, he expects that after the covid pandemic, significant private customer funds will flow into the markets – a pool of money that can also promote crypto.