End of Dollar and other currencies
Bitcoin to hit $40,000 in a year, never mind the bubble
As Bitcoin hit $10,000 today for the first time, renowned hedge fund manager Michael Novogratz calls a target of $40,000 on the cryptocurrency by the end of 2018, even as regulators keep on the edge over the rapid surge in the value and the hot air building up around it.
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The fund manager who was among the first ones to call a target of $10,000 on Bitcoin now predicts its value to quadruple to $40,000 in just about one year, even as the recent surge in price and heightened interest in Bitcoin from speculators and investors alike keep the regulators and bankers across the world on the edge. “Bitcoin could be at $40,000 at the end of 2018. It easily could,” former Fortress hedge fund manager Michael Novogratz said in an interview with CNBC TV18’s Fast Company.
Despite many legendary names in the investment market cautioning investors to stay away from it, Bitcoin is witnessing huge demand. Michael Novogratz said that the recent gains observed in the value of Bitcoin can be attributed to the rising demand from Asian countries such as Japan and South Korea.
According to Coindesk Bitcoin Price Index, Bitcoin topped $10,000 mark on Wednesday, recording a historic high. The cryptocurrency was trading at $10,052 at the time of reporting. The market cap for the virtual currency also reached a historic high of $168 billion.
While investors may be adding to their positions in the cryptocurrency market, Reserve Bank of India’s Executive Director Sudarshan Sen had said earlier this year that the central bank is not comfortable with non-fiat or private cryptocurrencies such as Bitcoin.
Legendary investors from India and around the world have time and again cautioned investors to stay away from it. Thomas Carper, a senior United States Senator once remarked, “Virtual currencies, perhaps most notably Bitcoin, have captured the imagination of some, struck fear among others, and confused the heck out of the rest of us.”
No fundamental value
Legendary investor Warren Buffett had said In an interview to CNBC in 2014 that bitcoin is a “mirage”, adding that investors should “stay away from it”. In the same interview, Warren Buffett said, “It’s a method of transmitting money. It’s a very effective way of transmitting money and you can do it anonymously and all that. A cheque is a way of transmitting money, too. Are cheques worth a whole lot of money just because they can transmit money?… The idea that it has some huge intrinsic value is just a joke in my view.” Reiterating his belief on Bitcoins and cryptocurrencies, Warren Buffett told Marketwatch in October this year: “You can’t value bitcoin because it’s not a value-producing asset,” adding that it is a “real bubble in that sort of thing”.
The rapidly surging price of Bitcoin, without any underlying asset or value-base, has irked the top banker Jamie Dimon. “Bitcoin is a fraud and will blow up,” Jamie Dimon, the CEO of JPMorgan Chase, said earlier this year, adding, “The currency isn’t going to work.” He pointed out to the absence of an underlying monetary base to support its value. “You can’t have a business where people can invent a currency out of thin air and think that people who are buying it are really smart,” Jamie Dimon said.
Renowned investor Jim Rogers, sometimes referred to as commodities guru, too has sounded a note of caution on the prospects of cryptocurrencies, preferring to stay away from them for now. “I wish I was smart enough to buy cryptocurrencies.” Jim Rogers said in a recent interview with Kitco news. Further, Jim Rogers seemed to suggest that there might be a bubble building up in the cryptocurrency space. “It looks bubblish when you see the kind of price we see in bitcoins,” Jim Rogers said, adding that he doesn’t own any of the cryptocurrencies. “I certainly don’t know which one will come out on top, or if anyone comes out on top. But, I don’t own any.”