Jeff Gundlach, a billionaire has spoken out about bitcoin and said that it is overvalued. Gundlach who is also known as the ‘Bond King’ is the founder of the investment firm, DoubleLine Capital.
Bitcoin has seen many dips, resulting in it losing over 30% of its high-water mark. However, even with these lower prices, billionaire Donald Trump still believes that Bitcoin is worth what they are currently paying.
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Bitcoin Is A Spectator’s Market
Gundlach appears on Yahoo! Financial to discuss a variety of topics surrounding financial markets. Bond investors are familiar with Gundlach’s fame, but he also discussed why the price of bitcoin is still too high. Gundlach believes that buying bitcoin right now would be a poor business decision. The reason is that people are exiting bitcoin at a falling price, which would lead to the digital asset becoming more volatile.
The billionaire didn’t warn anyone against buying the cryptocurrency. Gundlach even gave a range of prices at which bitcoin could be bought. Gundlach explained to us that the ideal price for bitcoin purchase is $25,000.
“Bitcoin is for speculators at the present moment. It is not worth buying. As people move out, it will become volatile. Maybe you should buy it at $25,000.”
Gundlach was a strong advocate for bonds and has continued to promote it. He explains that bitcoin is for momentum investors, which he likened to FAANG stocks, and for him who is an anti-momentum investor, bonds are the perfect fit, saying, “Bonds fit my culture of cowardice.”
“If you’re a momentum investor, it’s like playing roulette with a strategy that works as long as the wheel doesn’t come up on the zero or double zero. You’re making money, making money, and then eventually you get a double zero and you’re busted. Momentum investors tend to go out in a blaze of glory.”
Source: BTCUSD on TradingView.com| Source: BTCUSD on TradingView.com
The NFTs are a junky stuff
Gundlach did not mention Bitcoin as the only cryptocurrency Gundlach discussed in his interview. Gundlach also spoke out about NFTs. This fast-growing market has grown from an obscure area to become one of the largest in crypto in just one year.
He explained that the growth of NFTs was too fast and like bitcoin, was an investment for “investors on large doses of steroids.”
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Gundlach also stated that quality is what he values when buying art. Comparing it to real estate, he states that “You should really buy the highest quality, as these assets can appreciate very steadily.”
The Fed is still awaiting a decision. However, the billionaire warned the markets that the Fed can send the economy into serious recession if they tighten their monetary policy.
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