Rick Rieder, the Chief Investment Officer of investment management firm BlackRock, has said investors should not focus on the current crypto market meltdown but look at the long-term prospects.
Speaking during an interview with Yahoo Finance on June 16, Rieder noted that the influx of cash around Bitcoin and the crypto market might have been the main undoing but maintained that the assets have a future in the financial future.
“You are seeing a lot of the leverage that was built up around crypto come unglued quickly. I still think Bitcoin and crypto are durable assets. It’s a durable business, but there was so much excess built around it in cash,” he said.
Bitcoin might overshoot
Notably, Bitcoin has plunged in recent months, trying to navigate the crypto market characterized with a high inflation environment and increasing interest rates.
Currently, the asset is struggling to sustain its gains above $20,000. By press time, Bitcoinwas trading at $21,150, a drop of almost 1% in the last 24 hours.
On the next price action, Rieder noted that with pressure around Bitcoin, the asset would likely overshoot and undergo further price correction before a bull run.
“My sense is in all these situations you overshoot, and my guess is you have probably got some downside to go from here. It’s hard to say what fair value is. My sense is like a lot of assets, you look two to three years hence, they will be higher than today. But it could overshoot on the downside,” he said.
Bullish sentiments around Bitcoin
Despite the market meltdown, several crypto analysts are projecting that Bitcoin will likely surge further after navigating the current conditions. For instance, senior commodity strategist at Bloomberg Intelligence Mike McGlone noted that the $20,000 level should be considered the new bottom.
The strategist believes that Bitcoin is a new asset still undergoing adoption, and once the supply diminishes, the value will likely rise with a projection of $100,000 by 2025.
However, a section of financial experts have cast doubt on the prospects of the crypto future. As reported by Finbold, economist Peter Schiff stated the ongoing Bitcoin price tumble is the final stages of the crypto market.
According to Schiff, the meltdown indicates a crypto bubble that is bursting and has been long overdue. With the crypto market losing its capitalization by over 55% in about six months, the economist projected that the trend is likely to continue.
Elsewhere, in the stock market, BlackRock’s deputy head Alex Brazier stated that amid the equities market correction investors should not buy in the dip. He noted that the company remains neutral while observing the next market movement.
Source: https://finbold.com/blackrocks-r-rieder-admits-bitcoin-is-a-durable-asset-despite-meltdown/