Bitcoin may lose up to 80% in the near future

There is no reason for investors to buy bitcoin right now, according to Guggenheim Investments chairman Scott Minerd.

The world's largest cryptocurrency is in the process of decline, the price of bitcoin can maximum drop to the threshold of about 10,000 USD/bitcoin.

'When we look at crypto history and look back at where we are, I really believe there will be an extremely deep drop in bitcoin, such that the price of bitcoin could drop 70-80%, and then the price of bitcoin will only be about 10,000 to 15,000 USD/bitcoin," he emphasized.

Bitcoin may lose up to 80% in the near future Picture 1

Bitcoin is currently trading at around $33,500, about 50% down from its all-time high above $60,000 three months ago. The fact that the price of bitcoin fell so deeply was caused by many factors, including the fact that Chinese and British officials made tougher moves; Many countries are stricter regulation of the environmental standards of bitcoin mining as well as concerns about the possibility that the asset has no intrinsic value at all.

"If you look at it this way, I wouldn't be in a rush to buy bitcoin and I don't see any reason to own it now. If you're a speculator, go down," Mr. Minerd told CNBC.

Mr. Minerd however is not always pessimistic about bitcoin. In December 2020, he told Bloomberg News that the bitcoin price should be around $40,000.

However, by May 2021, Mr. Minerd said that the price of bitcoin is now like a tulip bubble, citing the story in the 17th century, the price of tulips has also been blown up like now.

Late last month, he again had a pessimistic forecast: "Let's calculate more about the possibility of bitcoin depreciating, the next support level will be $20,000."

The Iranian government at the end of May 2021 officially announced a ban on mining bitcoin and many other virtual currencies, according to Iranian President Hassan Rouhani announced. Iranian officials believe that cryptocurrency mining has caused power outages in many Iranian cities.

The latest Iranian government regulation takes effect immediately and will remain in place until September 22, 2021, according to Rouhani. Thus, another government refuses to accept this cryptocurrency.

Over the past few months, the capital Tehran and many other major cities in Iran have lost power several times. According to Iranian officials, the situation is caused by a lack of gas, a prolonged drought affecting power plants as well as increasing bitcoin mining activity.

Worse, a lot of the energy-consuming activity comes from illegal cryptocurrency miners and unlicensed operations, according to Iranian government officials.

Therefore, Iranian authorities have taken measures to prevent illegal cryptocurrency mining activities as well as temporarily cut off power supply to cryptocurrency mining areas. People's electricity consumption increases when there are regulations at home. As temperatures in Iran rise, people's electricity consumption has been so high in recent weeks that many medical facilities have struggled to maintain equipment to keep Covid-19 vaccines cold.

Samuel Daniel

Update 12 July 2021