As we’ve seen before, it doesn’t matter how well bitcoin does or how strong it’s price becomes. There could be a dozen major rallies and there will still be doubters out there. Proof of that exists in Wall Street trader Michael Hartnett, who in a recent interview, referred to bitcoin as the “mother of all bubbles.”
Michael Hartnett: BTC is the “Mother of All Bubbles”
As it stands, Hartnett doesn’t necessarily believe that the bitcoin price is going to fall. At least he never hinted at this during his recent statements, but he does think that the asset is the product of “speculative mania,” saying that the bitcoin price has risen by more than 1,000 percent in just the last two years alone. This is far more than any stock or even gold has jumped within the same timeframe, and he finds this all a little questionable.
To an extent, it’s hard to ignore Hartnett’s words and dismiss them outright. As any bitcoin or crypto trader knows at this point, the digital currency arena is widely susceptible to outside market influence, volatility and price swings. Things are never quite what they seem, and it’s always important to be on one’s guard and only invest what we can afford to lose. To this day, many are still reeling from the financial losses that occurred in 2018, and investors should not be looking to take too many chances.
As the chief investment strategist at Bank of America Securities, Hartnett explains that whenever assets rise to this level in such short periods, things don’t usually end well for them. He points to several incidents in the past – such as the gold spike of the 1970s, the dot-com bubble of the 1990s and the housing market in the early 2000s – as prime examples.
Each time, the assets in question rose and rose until they simply couldn’t anymore. What was the result for each one? They all came crashing down and took people’s money along with them.
He says that bitcoin prices keep surging because people continue to invest, though most of the investors have no idea what they are doing and are simply jumping on the crypto train as of late because it’s the thing to do and they don’t want to miss out on any potential gains.
In addition, he comments that the U.S. dollar and other forms of fiat have stabilized somewhat in recent weeks. As a result, the argument that bitcoin is somehow a hedge tool that can protect one’s wealth during times of economic strife is no longer valid justification for ownership.
Others Feel the Same
Other analysts offer similar sentiment when it comes to BTC. Mike O’Rourke – chief market strategist with Jones Trading – commented in a recent report:
The bitcoin chasers here are not protecting themselves versus a dollar meltdown. They are simply paying twice as much for an ‘asset’ than they were at Thanksgiving.