The global chief investment officer of investment giant Guggenheim Partners Scott Minerd is warning that Bitcoin’s support level at just above $31,000 could crumble.
Speaking to Bloomberg, Minerd says Bitcoin’s slide to around $29,500 earlier this week might have been a “false breakdown,” and he sees the flagship cryptocurrency falling even further.
“The market had gone parabolic. There was a surge from $10,000 to over $60,000. We’ve pulled back here to the neighborhood of $31,000 today, give or take. And the support level is really being tested hard, and the breakdown, we got to about $29,500, could be a false breakdown. But I don’t think so. I think that there’s still more air to come out of this…
The standard bear market for Bitcoin has been an 80% retracement. And given all the uncertainty and the new competition from new coins and everything else, I think that there’s more downside to go.”
Minerd says that further declines in Bitcoin’s price will reduce investor enthusiasm in the asset class, which will present a potential buying opportunity.
“If we get another washout, the popularity of crypto is going to fade quite a bit among people who are so anxious to jump in right now. But again, that’s probably a good sign that it’s a buy.”
Minerd warns that Bitcoin’s dominance over the long term is under threat.
“There’s a real question here, though, about what is the winner in the crypto world? Obviously Ethereum, for a number of reasons, looks better long term as a viable crypto coin than Bitcoin…
I don’t think we’ve actually seen the coin or the cryptocurrency that is going to dominate the market… Just like we didn’t see Google well after Yahoo had already established itself as the dominant search engine.”
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