Mass adoption of bitcoin is unlikely, as is a rise in its price above $100,000, Mohamed Ali El-Erian, chief economic adviser to Allianz asset manager, said.
“If you are a #crypto fan you should welcome the relative stability we have seen the last two months,” says @elerianm #bitcoin. “#crypto can and should survive as part of the ecosystem for payments…it just needs to be better regulated.” pic.twitter.com/CyVUSNwHfw
— Squawk Box (@SquawkCNBC) October 31, 2022
“I don’t think that bitcoin will become a global currency and receive recognition from institutional investors. When people say that it will reach $100,000, $200,000 or $300,000, they assume the mass distribution of the first cryptocurrency, but this will not happen,” the economist said.
In his opinion, digital gold is now going through a typical cycle of any innovation: after a boom (reaching an all-time high at $69,000 in November 2021) and “overproduction” (a large number of asset-related products and investment funds), a recession has come.
However, industry participants should be positive about the current crypto winter, El-Erian added. He noted that bitcoin in a market recession turned out to be more stable than the stock market, and the worst moments of the bearish cycle are behind.
The Economist also pointed to the importance of regulation. According to him, the emergence of relevant rules will solve the problems of the first cryptocurrency and some altcoins.
Earlier, El-Erian told how he made money on bitcoin after the crypto winter and admitted that he sold the coins “too early.”
In the spring of 2022, the economist suggested what changes in the policy of the US Federal Reserve System would lead to an increase in the price of the first cryptocurrency.
Recall that in September, Bitcoin maximalist and founder of MicroStrategy Michael Saylor predicted a new historical maximum price of the first cryptocurrency in the next four years.
In October, trader and analyst Michael van de Poppe predicted digital gold would reach $30,000 in November, while macro investor Raoul Pal allowed the crypto market capitalization to rise to $300 trillion in the next 10-15 years.
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