El-Erian Says He Would Buy Bitcoin If It Falls Below $5,000
Mohammed El-Erian is a chief economic advisor at Allianz. He recently revealed that he would be willing to purchase the bitcoin if its price falls below $5000. The crypto coin was trading at $5,850 on Friday morning. This represents a 70% drop since it peaked in December 2017.
According to El-Erian, Bitcoin is more of a tradable commodity than crypto. Despite this, he believes the blockchain technology that powers the bitcoin is here to stay. El-Erian is confident that the Bitcoin will be here but it will only be a store of value, much like gold.
Now Is The Perfect Time To Buy
El-Erian, who is the chief economic advisor of Allianz, is considered amongst the most influential financial market thinkers. The remarks about possibly buying bitcoin if it falls below $5000 were made on the CNBC’s Squawk Box.
He added that he does not expect bitcoin to hit $20,000 again. However, he said that there was a need to establish a base where people that believe bitcoin has a future could consolidate. This will then offer a lift for the coin.
Bitcoin saw a huge jump in prices in 2017 as digital coins globally surged in popularity. At the time, many competitors also joined the crypto market. Despite its rise, Bitcoin has faced many problems. These include regulators clumping down on crypto and the rise of fake ICO projects. This led to a major pullback of the coin from a peak of about $19,000 in December 2017.
About The Future
El-Erian also talked about the future of crypto. At one point, over 40 digital coins had a market cap of above $100 billion. Today, Bitcoin is the only coin with that special designation. Despite this, the future is still positive for crypto. El-Erian added that crypto would never become currency but would work like a commodity.
In his view, in the next 10-15 years in future, there will still be digital coins with an involvement by the public sector. He added that it would not be pure bitcoin. El-Eria believes that the blockchain technology is something that needs to be taken seriously.
The blockchain is the foundation on which the bitcoin is based. It serves as the digital ledger of transactions. This technology is expected to catch on in the banking sector. Bitcoin will exist alongside this technology. However, it may not be in the form that most people think it will be.
El-Erian strongly believes that bitcoin will not pan out as a currency. Instead, it will be used as a means of exchange. It will be like a commodity that you can trade but mainly as the store of value. The price of Bitcoin seems to have stabilized in recent months. Although it has lost a lot of its market cap, it managed to hover around $5,000 – $6000 for a while. It is not likely that it will drop below $5000 in the coming weeks. However, this is crypto and wild swings in value are not unheard of.