Guggenheim Partners’ Scott Minerd remains long-term bullish on bitcoin, but said Wednesday the world’s largest cryptocurrency has run too far, too fast.
“Given the massive move we’ve had in bitcoin over the short run, things are very frothy, and I think we’re going to have to have a major correction in bitcoin,” the firm’s global chief investment officer told CNBC’s “Worldwide Exchange.”
Bitcoin traded just under $55,000 per token Wednesday morning, one week after setting an all-time high of nearly $65,000 in the run-up to crypto exchange Coinbase‘s blockbuster direct listing.
“I think we could pull back to $20,000 to $30,000 on bitcoin, which would be a 50% decline, but the interesting thing about bitcoin is we’ve seen these kinds of declines before,” Minerd said. However, he said he thinks it’s part of “the normal evolution in what is a longer-term bull market,” with bitcoin prices eventually reaching between $400,000 to $600,000 per unit.
Minerd turned heads late last year when he first shared his long-range price target for bitcoin, citing its inherent scarcity — only 21 million bitcoins will ever be created — and its value relative to assets such as gold. Those remarks in December fell on the same day the digital currency eclipsed $20,000 for the first time ever.
Bitcoin has continued its massive rally that began in 2020, advancing nearly 90% so far this year. Institutional adoption has been cited as one factor fueling its rise. Some companies like Tesla invested a portion of their cash holdings in bitcoin, and financial firms from Mastercard to Goldman Sachs are making moves around crypto.
The pace of bitcoin’s ascent has worried even some crypto bulls like Minerd, who also warned of a short-term pullback earlier this year. Some crypto bears continue to argue bitcoin is in a bubble that will eventually burst.
Bill Miller, the longtime value investor who has owned bitcoin for years, told CNBC on Tuesday he’s not concerned about the digital currency being in a bubble like in 2017, when it reached what was then a record high of nearly $20,000. Bitcoin went on to fall sharply in the following months, losing about 80% of its value in what’s become known as the “crypto winter.”
“Supply [of bitcoin] is growing 2% a year and demand is growing faster. That’s all you really need to know, and that means it’s going higher,” Miller said in an interview on CNBC’s “The Exchange.” It may not be a straight march to the upside, though, because “with bitcoin, volatility is the price you pay for performance,” he added.
