"Bitcoin Could Fall To $8,000" Says Guggenheim's CIO.

By CryptoChad | CryptoNews; The latest about the cryptoverse | 28 May 2022

Scott Minerd, CIO of Guggenheim, is arguing that Bitcoin has a new bottom level of down to $8,000 and that most cryptocurrencies are junk. Is the prediction accurate and if yes how much more can Bitcoin lose?

In today's article, we are going to focus on the prediction and if another sharp loss is feasible.

Minerd's prediction on Bitcoin.

“When you break below 30,000 [dollars] consistently, 8,000 [dollars] is the ultimate bottom, so I think we have a lot more room to the downside, especially with the Fed being restrictive.”

These are the first words of Minerd to CNBC as he referred to the extreme loss of value since the ATH and the Fed's aggressive policies regarding interest rate increases and fiscal policies.

Bitcoin is already struggling to reach $30,000 and at the moment the momentum is ambivalent. Around $500 billion has already been withdrawn from Bitcoin since the last month, therefore further instability might discourage new investors.

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TradingView chart showing BTC/USDT pair as of 28 May 2022.

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Minerd's opinion on cryptocurrencies, the market, and related technologies.

An interesting and controversial topic is the CIO's view on cryptocurrencies in general.

“Most of these currencies, they’re not currencies, they’re junk,” he said, even though he still named Bitcoin and Ethereum as potential survivors of the bear market. Even so, he added, “I don’t think we’ve seen the dominant player in crypto yet.”

Minerd compared the current situation to the dotcom bubble of the early 2000s. “If we were sitting here in the internet bubble, we would be talking about how Yahoo and America Online were the great winners,” he said. “Everything else, we couldn’t tell you if Amazon or Pets.com was going to be the winner.” This says a lot about the potential crypto markets have to reach new heights.

“I don’t think we have had the right prototype yet for crypto,” he continued, claiming that currency needs to store value, be a medium of exchange and unit of account. “None of these things pass, they don’t even pass on one basis,” he said, thus revealing that cryptocurrencies are far from mass adoption.

Nevertheless, he stated that the latest technological advances could change that and help create an ecosystem where people get used to using cryptocurrencies for transactions and are confident they will hold their value.

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Minerd's previous predictions.

Minerd has already done many predictions regarding Bitcoin.

In an interview with Bloomberg before Christmas 2020, Minerd stated, "our fundamental work shows that Bitcoin should be worth about $400,000." At the time, Bitcoin was performing around $20,000. It surged to $40,000 a month later.

He also confirmed that several Guggenheim investors had bought Bitcoin on his recommendation: "Some of our private funds have already purchased it… If you believe what I said that it'll go to $400,000 eventually, 2% of your portfolio will be 20% before this is all over."

In an interview with CNN in February 2021, Minerd gave a new price prediction of $600,000, again based on Guggenheim's research. He stated that "if you consider the supply of Bitcoin relative to the supply of gold in the world, and what the total value of gold is, if Bitcoin were to go to those kinds of numbers, you'd be talking about $400,000 to $600,000 per Bitcoin."

A few weeks later, Bitcoin fell from over $63,000 in mid-April to just over $33,500 on July 9. Minerd told CNBC the price could bottom out at $10,000. He was wrong, as Bitcoin fell below $30,000 but later bounced and reached an ATH in November.

Conclusion

Most speculations on Bitcoin and crypto, in general, are exaggerated and based on emotions or flawed research. Even though Minerd has done some very exaggerated predictions in the past (both in bearish and bullish periods) he is somehow right in terms of the momentum of the market, as he correctly predicted the direction of Bitcoin although the eventual prices were far from his estimations. I also agree that many cryptocurrencies are indeed useless because altcoins are reliant on Bitcoin for their movement and others have no reason for existence (I have already stated it elsewhere). Finally, in terms of value storage, Bitcoin and cryptocurrencies have important advantages; decentralization, minimal fees, and scarcity, which can turn them into media of exchange. The only thing remaining for mass adoption is a stable high market cap which can lead to more safety regarding payments and trade.

That's all I had for today. I hope you enjoyed the article and appreciated the effort. Do you believe this prediction is accurate? In my opinion, Bitcoin is going to continue falling mostly because of Fed's policies and the current turmoil in the markets and I don't phase out a bottom of $15,000. However, in recent years, Bitcoin has naturally become more resistant to extreme crashes due to higher market cap and more people are able to understand its advantages. Besides, this correction remains a great opportunity to buy at lower prices before it escalates to better levels again.

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