- Scott Minerd expects the crypto market to drop further.
- According to Minerd, solid regulations will decide the future of crypto.
- He also stated that some crypto projects would survive the meltdown.
Guggenheim Partners’ Chief Investment Officer Scott Minerd has warned investors following the demise of the FTX cryptocurrency exchange and what appears to be a broader meltdown of cryptocurrencies. According to the CIO, the FTX crisis is the beginning of a larger industry-wide shakeup in the cryptocurrency sector.
Speaking during a televised interview about the US Federal Reserve’s interest rate hike, Minerd said:
There’s another shoe to drop [..] A year ago, we were talking about crypto, and there were approximately 19,000 coins, there is going to be wash out just like the internet bubble.
Further, as an example of a “bubble,” Minerd compared the cryptocurrency market to the dot-com era. In addition, he admitted that he had been left bewildered by the waning excitement surrounding the non-fungible token (NFT) market. However, while the Guggenheim CEO is certain that some cryptocurrency ventures will survive the current crisis, he did not name any of them.
He stressed that the cryptocurrency market and its broader adoption is in its infancy and that a solid legal framework would determine the sector’s future. He went on to add:
“Any number of periods where we had easy money and a lot of speculation; the weakest players fall first. Crypto was obviously something that is crazy,” Minerd added.
In May, Minerd predicted that the price of Bitcoin would plummet to roughly $8,000. Meanwhile, prominent fund manager Mark Mobius voiced similar sentiments, stating on CNBC’s Squawk box that Bitcoin could drop to $10,000 in 2023.
“With higher interest rates, the attraction of holding or buying Bitcoin or other cryptocurrencies becomes less attractive since just holding the coin does not pay interest,” Mobius noted in an interview.
So far, neither of these bearish predictions has been realized. Following the collapse of the FTX exchange, the price of Bitcoin fell to a multi-year low of $15,479 and has since staged a partial recovery. Earlier this week, the leading cryptocurrency topped $18,000.