Bleakley Advisory Group CIO: Bitcoin to $1000 by 2019?
Sometimes you just can’t resist a bit of a pun: the chief investment advisor for Bleakley Advisory Group, Peter Boockvar, has a bleak outlook for the price of bitcoin this year. While just weeks ago it was slamming into record highs with all the fury of a shark trying to break through a cage, Boockvar looks for the order of the day to be tumbles aplenty as bitcoin’s bubble bursts.
Boockvar notes “Over the next year I wouldn’t be surprised if it’s down to $1,000 to $3,000.” That represents somewhere around a 70 to 90 percent price drop over current levels, as Boockvar expects the current pricing to prove bubble pricing only.
Even Boockvar expects only so much fallout from a bitcoin price crash, noting that bitcoin is “not something that really is that relevant in a 19 trillion dollar economy,” although those who took out huge credit card debt—like in Japan, South Korea and the US—might be unusually hard-hit.
Projections of a bubble burst seem unlikely, as it doesn’t seem like we’re quite into the “everybody” phase of a bubble yet. When dot-com stocks were in their bubble, everyone was rushing to get in. Real estate, same deal. But where is the “everybody” phase of bitcoin? Sure, there are a handful of people mortgaging their houses to get in, but most people will look at you blankly when you talk about cryptocurrencies.
There’s the issue of scarcity to consider. We know bitcoin has practical applications beyond buying stuff at Overstock.com—its blockchain connections are too much to overlook—and there will only be so many bitcoin to work with. Reports suggest that around 80 percent of all bitcoins ever made have been mined already, which means as others want to use it, or own it, they will have to be bought elsewhere. This may in turn drive up the price still further.
Could bitcoin see its biggest reversal to date this year? Sure it could. Bitcoin’s been volatile enough to prove it could do anything. This could be the year that bitcoin goes to $1,000, $75,000, $250,000, or even $1 million per coin. Only time will tell, so for bitcoin owners out there, HODL (hang on for dear life) is still the order of the day.