[Comprehensive] "Cryptocurrency is Trash... Bitcoin Will Fall to $8,000"

[Image source=Reuters Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] At the World Economic Forum Annual Meeting (WEF·Davos Forum) held in Davos, Switzerland, pessimistic forecasts surrounding cryptocurrencies such as Bitcoin poured out. Scott Minerd, Chief Investment Officer (CIO) of global asset management firm Guggenheim Investments, warned that Bitcoin could plunge to $8,000. This means it could fall more than 70% from the current price.

According to the U.S. economic media CNBC, Minerd CIO said in an interview at the Davos Forum Annual Meeting on the 23rd (local time), "Considering the Federal Reserve's (Fed) tightening moves, there is a very high possibility that (Bitcoin) will fall further downward." He predicted, "If the $30,000 level is continuously broken, $8,000 will be the ultimate bottom."

Bitcoin, the leading cryptocurrency, hit an all-time high of $67,802.30 on November 9 last year. However, due to the Fed's monetary tightening, increased concerns about economic slowdown, and the collapse of the Korean cryptocurrency Luna, it recently fell below $30,000. The decline over the past month alone amounts to about 24%.

CNBC pointed out that Minerd CIO's forecast means a drop of more than 70% from the current price. As of the morning of the 24th Korean time, Bitcoin is trading around $29,088, down 2.84% from the previous session.

Minerd CIO evaluated, "Most cryptocurrencies are junk, not currency." However, his view is that the leading cryptocurrencies Bitcoin and Ethereum will survive. He compared the recent situation in the cryptocurrency market to the early 2000s 'dot-com bubble,' pointing out that cryptocurrencies have yet to satisfy any of the three elements of currency: store of value, medium of exchange, and unit of account. Minerd CIO had once made a rosy forecast that Bitcoin would reach $600,000 but announced last year that he no longer invests.

This pessimistic outlook drew attention as it came shortly after Christine Lagarde, President of the European Central Bank (ECB), recently stated that cryptocurrencies "have no value." Earlier, President Lagarde expressed concern about "those who do not understand the risks, who will lose everything and be shockingly disappointed," arguing that "this is why cryptocurrencies need to be regulated."

Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), also hinted at possible regulation on the same day in Davos by labeling the Luna and TerraUSD (UST) collapse as a "pyramid."

Georgieva criticized, "Stablecoins are stable at a 1:1 ratio (against the dollar) if backed by assets, but if they are not backed by assets and promise a 20% return, that is a pyramid scheme." She warned, "What happens to a pyramid scheme? Eventually, it shatters and collapses."