Economy
“Whoa!” – Guggenheim’s Scott Minerd Says Bitcoin Should Be Worth $400,000
“It’s based on the scarcity and relative valuation to things such as gold …”
Guggenheim Chief Investment Officer, Scott Minerd, provided Bloomberg TV hosts a ‘Whoa!’ moment when on Wednesday he said his firm’s fundamental analysis shows bitcoin should be worth $400,000.
“Our fundamental work shows that bitcoin should be worth around $400,000,” said Minerd.
“Whoa!,” one of the hosts quickly snapped.
When asked how he came to place bitcoin at such a high valuation, Minerd explained:
“It’s based on the scarcity and relative valuation to things such as gold as a percentage of GDP. Bitcoin actually has a lot of the attributes of gold and at the same time has an unusual value in terms of transcations.”
As Bloomberg notes, Guggenheim is among the institutional players that are validating bitcoin’s legitimacy with the firm last month filing to reserve the right for 10% of its $5.3 billion Macro Opportunities Fund to invest in the Grayscale Bitcoin Trust.
Guggenheim currently has $270 billion of assets under management.
After having broke the $20k level for the first time in its history on Wednesday, bitcoin has continued to climb to new heights into Thursday with the price, at the time of writing, at $23k.
As we noted yesterday in our price coverage, such parabolic price action since the March 2020 lows could bring one back to the 2017 crypto bubble, but the positive fundamental analysis from a big player like Minerd makes the case for this time being somewhat different.
A similar case based on the fundamentals has been made by Joseph Young of Cointelegraph.
“This rally is different from 2017’s due to several reasons that could help BTC soar even higher. These include growing institutional demand, the increasing perception among investors that BTC is a store of value, and stronger network fundamentals,” Young wrote on Wednesday.
Young also points to the increase in the daily value transfered on the Bitcoin network and the increase in the network’s hash rate – a metric used to gauge network security – as strong reasoning for the increase in price:
As Cointelegraph reported, Bitcoin’s fundamentals are stronger than ever as the network is now moving $500,000 per second around the globe. In other words, Bitcoin transfers $4.627 billion in value per day.
The network is also ten times more secure than in late 2017, as the hash rate and mining difficulty both continue to hit new highs this year. The hash rate indicates how much computing power is being dedicated to validating Bitcoin transactions and securing the network.
In other price action news, Ethereum is also continuing its climb higher …
The total cryptocurrency market capitalization is quickly approaching its December 2017 high …
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