CNBC’s Fast Money, Spencer Bogart discussed the state of the cryptocurrency industry, why he thinks the market has generally slumped in 2018 and why he still believes bitcoin to be a good buy.
Explaining his views on the general bitcoin market, Bogart qualified his general optimism:
“I’m super bullish on crypto right now but does that mean that I think that things cant go lower? It doesn’t – I think the prices are prices are pretty good right now if I was looking to buy something like bitcoin.”
The current Bitcoin price gains have come at a time when China and the United States are locked in a trade war. Beijing has responded by devaluing the country’s fiat currency. Consequently, BTC has become a valuable option for wealthy Chinese individuals looking to maintain their holdings; no one wants to store wealth in a currency that is being significantly devalued.
More specifically, he thinks that the market-wide slide in prices that has characterised much of 2018 so far has its roots in crypto-hedge funds:
“But specifically why prices might go lower we are talking about a fund redemption cycle: so if we go back to the summer of 2017 when crypto prices were booming there was about 100, 200 maybe 300 new crypto hedge funds that were formed…well now here in the summer of 2018 a lot of them are hitting the end of their one year lockup. That means that the LPs in those funds are now looking at a down 50% year and..want to redeem out of that fund.”
On Wednesday, Bogart said bitcoin may have hit its bottom for the year, but that he was “definitely expecting to see new highs” and told investors to expect more regulatory approval of the space in the coming year.
Actually, the price is sitting ideal waiting for either bulls or bears to make an appearance. The resistance target for bitcoin right now is at $8,300 and if it has to go beyond $8,500, the price has to break above $8,400.
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