The price of bitcoin has yet to deliver a turnaround in value, but with this downward trend now is the time to buy, says the founder of Capital Management.
Speaking to CNBC, Brian Kelly, portfolio manager of the BKCM Digital Asset Fund, said:
Now, when everyone is saying … it’s over, that’s it, bitcoin is dead, for the 175th time. Now’s the time you start looking at it, on the buy side.
According to Kelly, we are in a ‘hands-off’ period as uncertainty remains over the crypto market. With heightened interest from traders brings more global regulatory pressure. South Korea’s government is reportedly planning to hit digital currency exchanges with tax bills while the country’s banks are expected to ban anonymous cryptocurrency trading accounts by the end of January. As a result, these two factors alone are producing an impact on market prices.
Yet, despite regulatory uncertainty within the market and fluctuating values, the money is still coming in, said Kelly, adding:
This is not the end of bitcoin.
He argues that the time to be cautious is when the cryptocurrency is experiencing high prices. This is when it can be dangerous for investors to purchase the currency.
In Kelly’s opinion there are three golden rules for digital currency investors:
Since the end of December and the beginning of January, bitcoin’s price has remained stagnant, struggling, in recent days, to get back over $11,000 until now. At the end of 2017, the number one digital currency saw an increase in investor trading, which pushed its value to within touching distance of $20,000 for the first time. Since then it has slumped in value and is currently trading at $11,151, according to CoinMarketCap.
For many, though, it’s only a matter of time before the currency regains previous highs to then achieve new records.
According to Kay Van-Petersen, an analyst at Saxo Bank, he believes that bitcoin could hit between $50,000 and $100,000 in 2018. Van-Petersen is the same person who rightly predicted in 2016 that the cryptocurrency would reach $2,000 last year. This it achieved in May. Now, he’s looking further ahead with the currency’s value, stating earlier this month:
First off, you could argue we have had a proper correction in bitcoin, it has had a 50 percent pull back at one point, which is healthy. But we have still not seen the full effect of the futures contracts.
Not only that, but given the fact that there will only be 21 million bitcoins in existence, the eventual scarcity of them will boost the currency’s value up.