Following last Friday’s new low for 2018, Bitcoin bounced back to $6,250 by Tuesday. However Spencer Bogart, the revered blockchain venture capitalist and BTC “Bull” – while super positive for Bitcoin’s long-term future – still fears BTC investors should be prepared for further valuation falls.
On Friday, Bitcoin’s value briefly fell below $6,000 for the first time since October 28 2017. Ironically, on that prior occasion, Bitcoin was about to embark on an incredible run and was in fact just 50 days away from hitting its all-time high of $19,900, which it reached on December 16. It would however be a short-lived high, and by the first week of February 2018, Bitcoin had already dropped below $7,000.
When Bitcoin Falls – It Takes Everyone With It
By June 22, according to some crypto exchanges, Bitcoin fell below $6,000 – a fall of 70% from its December high. Worryingly, it took the rest of crypto’s elite Big Five with it – Ethereum (down 67% from its record high), Litecoin (down 78%), Bitcoin Cash (down 81%) and Ripple (down 87%), all of which hit 2018 lows.
The release of some 250,000 Tether tokens on Monday had the desired effect and kick-started the crypto market – albeit slightly. The more bullish of crypto traders were feeling optimistic on Monday when it was clear Bitcoin would be heading into Tuesday around $6,254.
Bitcoin Believer Spencer Bogart “Super Bullish”?
One of those Bitcoin optimists heading in to Tuesday is Spencer Bogart, CEO of the blockchain based venture capital firm Blockchain Capital. Spencer is rarely less than positive about Bitcoin, but also super-realistic about its current predicament. So, while he professed to being “super bullish” about Bitcoin right now, he also warned its value could go “even lower.”
In a conversation on CNBC’s Fast Money on Monday, Bogart said:
“If we go back to the summer of 2017, when crypto prices were booming, there was about a 100, 200, maybe 300 new crypto hedge funds that were formed.”
Bogart stated that in his opinion, most of these hedge funds are now “hitting their one-year lock up.” What that means is with the price of most cryptocurrencies down by more than 50% from their all-time high, many so-called “liquid providers” (those people who work as intermediaries between brokers and exchanges) are looking to sell.
“They’re saying, ‘hey, I want to redeem out of that fund.` That means forced selling on behalf of all of these new crypto funds that have popped up. I think that could take prices artificially lower.”
Every week there seems to be another ICO (Initial Coin Offering) on the go, and Bogart believes that the vast majority of these ICOs are overvalued. But if an investor yet to take the plunge and put money into cryptocurrency is looking for a good deal, Bogart pointed out that the price for Bitcoin is “pretty good right now” which makes for a great short term investment.
“Most people that are going to wait for lower prices will end up paying higher prices than they are today. So I think the right move is to not try and time the market and try and average into it.”