Bitcoin price is back above $35,000, Mark Cuban calls it a bubble

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Bitcoin price recovered back to around $35,000, as the crypto market recovered from Monday’s plunge, but volatility is still high and superstar investor Mark Cuban called the recent rise a “bubble” that could be ruinous.
Bitcoin dropped as much as 20% on Sunday and Monday to just above $30,000 in a wave of profit-taking after the currency’s price rally. Investor are worried and a higher dollar also hit crypto-confidence.
Yet the Bitcoin price increased sharply on Monday evening and Tuesday morning, climbing more than 15% from Monday’s low and breaching the $36,000 mark again. It then slipped back slightly to $35,715 at 4.23am ET.
The cryptocurrency has increased more than 13% in just a week, 92% in a month and around 340% in a year, after markets were flooded with money by central banks during the pandemic.
The remarkable rise in cryptocurrencies has attracted attention from all corners of the markets. Yesterday, Cuban warned on Twitter about Bitcoin price and said the “cryptos trade” is “EXACTLY like the internet stock bubble” that was seen in the late 1990s, which burst with disastrous consequences for many firms and investors.
Yet he said that Bitcoin, Etheruem and “a few others” could survive and “thrive”, as companies such as Amazon and eBay did two decades ago.
Ethereum was up on Tuesday morning to $1,111. It was trading close to the ATH of more than $1,200 seen in early 2018, and has increased around 675% in the last year.
“Watching the cryptos trade, it’s EXACTLY like the internet stock bubble. EXACTLY. I think btc, eth , a few others will be analogous to those that were built during the dot-com era, survived the bubble bursting and thrived, like AMZN, EBay, and Priceline. ”
Cuban warned against trusting crypto evangelists who “try to justify whatever the pricing of the day is”.
“All the narratives about debasement, fiat, etc are just sales pitches. The biggest sales pitch is scarcity vs demand. That’s it,” he twitted.
But Bitcoin enthusiasts say this time is different, and argue that a price crash like the one seen in 2018, which saw the price hit a then-record around $19,900 only to drop to around $5,870 in eight weeks, is unlikely.
Michael Hall, co-founder of Nickel Digital Asset Management, said Bitcoin “is experiencing upside volatility which may correct sharply but tends to resolve reasonably quickly at higher levels as price discovery continues.
“We do not believe there has been any fundamental change in the outlook for Bitcoin which is now increasingly owned by longer-term investors, weighted towards Europe and North America, looking to buy and hold within multi-asset portfolios.”
However, UBS experts took a dimmer view. They said in a note: “Given their high volatility and the size of their past drawdowns, cryptocurrencies might be attractive to speculative investors, but they are neither a suitable alternative to safe-haven assets, nor do they necessarily contribute to portfolio diversification.”
The UK’s Financial Conduct Authority yesterday said: “If consumers invest in these types of product, they should be prepared to lose all their money.”
“Significant price volatility in cryptoassets, combined with the inherent difficulties of valuing cryptoassets reliably, places consumers at a high risk of losses,” it stated.

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