Loup Funds analysts Gene Munster and Dough Clinton — touching upon the recent cryptocurrency crash that plummeted valuations of Bitcoin BTC/USD and Ethereum ETH/USD — said that “crypto is here to stay.”
What Happened: In a recent discussion, Munster noted that the downturn in the prices of Bitcoin was sharper compared with the tech-stock-heavy Nasdaq.
Munster said the volatility in cryptocurrencies “scares an old guy like me.”
“People who are believers in crypto aren’t necessarily shaken by a 50 percent drawdown,” Loup’s Clinton said.
“Crypto hasn’t died, it’s been drawn down by 50 percent four times in the short span, it’s been drawn down by, I think, 80 percent a couple of times over its history and it’s still here.”
See Also: How To Buy Bitcoin (BTC)
Why It Matters: Both Bitcoin and Ethereum are trading nearly 50% below their November all-time highs of $68,789.63 and $4,891.70, respectively.
In the past week alone, the global cryptocurrency market cap has declined from nearly $2 trillion to $1.62 trillion, a fall of almost 19%.
Clinton touched upon a phenomenon known as the Lindy effect. As per this phenomenon, the longevity of certain non-perishable things like technology is proportional to their current age.
“So it's kind of this like survivorship bias in a sense and Bitcoin's been around for more than a decade right now and I think there's more people who own it than ever there's more people that are interested in it than ever 50 percent drawdown is just kind of par for the course for people who follow it.”
Munster concurred with Clinton on his take on the longevity of Bitcoin.
Price Action: At press time, over 24 hours, BTC traded 2.4% higher at $35,985.20 while ETH traded 2% lower at $2,385.73.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
