The Chief Economic Advisor of the largest financial services group, who was criticising bitcoin as the biggest asset bubble, says now to buy BTC below $5,000
Mohamed El-Erian, a chief economic advisor at Allianz, which is one of world’s largest insurance firm and also one of the largest financial services group (based on a Forbes composite measure), said in an interview that Bitcoin would be a buy if the price fell under $5,000.
Back in September 2017, CCN reported on his criticisms that Bitcoin was triple its true value. As CCN reported in December 2017, El-Erian believes that the sharp price decline in bitcoin was a defining moment. It would either end up as a healthy correction to shake out “irrational exuberance” and thus attract institutional investors or it would ultimately collapse and go down as the biggest asset bubble in history.
Now it seems that he has shown his hand. The “healthy correction” is nearing a point where even El-Erian believes that a buy-in is justified. The bubble hypothesis is not on his mind after all. The current market environment is finding a base that is attracting El-Erain’s attention.
He said that:
- blockchain tech is here to stay;
- Bitcoin will become more a commodity than a currency, much like gold as a “store of value”;
- a base needs to be reached “whereby the people who really believe in the future of bitcoin consolidate and then that provides you a lift.”
In the high-speed world of cryptocurrencies, it’s easy to miss the speed that the positive shift has occurred with even the staunchest crypto critics in the financial services industry. Federal regulatory bodies and giant institutional investment firms are known for taking slow courses of action. In less than a year, most of the recognizable brokerages and financial firms have done a 180 with their opinions and started joining the cryptocurrency movement. For instance, Fidelity Investments and Goldman Sachs are launching trading desks for cryptocurrencies.
Despite the current slump in Bitcoin price, the correction appears to be improving sentiment among institutions that believed Bitcoin’s price during the late 2017 run-up did not justify its value.
The article was published for the first time at https://www.ccn.com/bitcoin-a-buy-below-5000-says-allianz-chief-economic-advisorTweet