As Bitcoin, which had been around 20 million won, has risen to 44 million in less than a month, US Wall Street analysts are raising their voices of caution.
On the 9th (local time), CNN Business justified and insisted that the price of bitcoin and the like in cryptocurrency (virtual real estate) exchanges is rising, but Wall Street reported that the recent’Bitcoin Rally’ is the result of speculation being reflected.
Bank of America Securities’ Michael Hartnet chief investment strategist diagnosed “Bitcoin is the’mother of all bubbles’.”
In a recent report, Heartnet explained that the price of bitcoin has soared by about 1,000% since early 2019, far outperforming other assets that have risen sharply over the past decade.
The report introduced a surge in gold prices of more than 400% in the late 1970s, Japanese stocks in the late 1980s, the Thai stock market in the mid-1990s, dot-com bubbles in the late 1990s, and housing prices in the mid-2000s. The assets introduced showed a three-digit increase just before they went out.
Heartnet did not predict that the price of Bitcoin would drop sharply. Instead, he referred to the cryptocurrency price bubble as an example of speculative investing.
Wall Street officials are advising to be alert to the sharp rise in bitcoin prices. In particular, as the US dollar has been stabilizing recently, it is expected that it will be difficult to benefit from bitcoin hedging.
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“Investors who have invested in the bullish bitcoin are not protecting themselves against the collapse of the dollar,” said Mike O’Rook, chief market strategist at John Strading. “They are simply paying twice as much for their assets.”
On the other hand, Bitcoin investors are observing that the price will continue to rise. This is due to the growing interest of key investors, including Paul Tudor Jones and Stanley Druckenmiller, as well as the mainstream adoption of cryptocurrencies such as PayPal and Square. Bitcoin has soared more than 20% over the past five days.