Bitcoin skeptics have always kept the argument of volatility in their back pocket whenever the asset’s valuation has undergone a significant correction in the market. During price discovery in December and most of January, Bitcoin faced little criticism, but over the past two weeks, comments such as “speculative bubble” and “extremely inefficient” have all been thrown around to describe the cryptocurrency
However, this particular investor begs to differ. Bill Miller cited his optimism regarding bitcoin in a recent interview on CNBC’s “The Exchange”. He stated:
“Supply [of bitcoin] is growing 2% a year and demand is growing faster. That’s all you really need to know, and that means it’s going higher. I don’t think this is a bubble at all in bitcoin; I think it’s the beginning of mainstreaming BTC.”
Institutional adoption had been cited as one factor for bitcoin’s rise, with companies such as Tesla buying the digital coin using cash on its balance sheet. A pair of major Wall Street banks — Morgan Stanley and Goldman Sachs — also took the steps to provide wealth management clients exposure to bitcoin.
Having said that, he also acknowledged Bitcoin’s volatility in the current market as well.
Miller, who managed a fund that beat S&P 500 for 15 straight years while at Legg Mason, said,
“Even back then during the bubble, it went down 20% on five different occasions so with bitcoin, volatility is the price you pay for performance.”
Historically, Bitcoin’s volatility continued to experience sharp price swings, like the one that emerged over the weekend, that knocked the digital coin. BTC dropped as low as $52,148.98 after reaching an ATH ahead of Coinbase’s debut. Miller first started buying Bitcoin around 2014 or 2015 at an average price of $350 per coin. According to him,
“Bitcoin is digital gold with a trillion-dollar crypto-asset category compared to precious metals’ $10 trillion market cap.”
Furthermore, others shared a similar point of view with regard to Bitcoin being better than gold. On the contrary, many skeptics before had weighed in to juxtapose the aforementioned point. Peter Schiff, the investor known for his negative commentary on Bitcoin, was in the news on multiple occasions providing a critique of Bitcoin. JP Morgan strategist Nikolaos Panigirtzoglou cited $60,000 as the key point of reference as the ‘do-or-die’ level for Bitcoin bulls.