Dan Morehead, founder of cryptocurrency hedge fund Pantera Capital Management, has recently stated that cryptocurrencies like Bitcoin have reached their lowest point this year, and that now is a good time to buy.
Morehead seemingly encouraged buyers to take advantage of this dip before an eventual rally. While speaking with CNBC, he stated:
“All cryptocurrencies are very cheap right now. It's much cheaper to buy now and participate in the rally as it goes.”
Bitcoin, the flagship cryptocurrency, hit an all-time high of nearly $20,000 in mid-December, before it started plunging to little over $7,000 earlier this year. Most cryptocurrencies crashed with it, as the cryptocurrency ecosystem lost over $87 billion.
According to the hedge fund manager, various events could be spelling out a new bullish trend for cryptocurrencies. Specifically, institutional capital entering the space may be what it needs. He said:
“Many institutions are essentially buying the rumor [of potential SEC regulations] and selling the fact. Getting invested now so that in three, four, five months when the institutional, quality-regulated custodians that we're hearing about come online, they'll already have their positions.”
Morehead further revealed that potential buyers could wait for a cryptocurrency to break past its 230-day moving average to enter a position, so they could then sell it again after holding it for at least a year.
Per his words, this strategy will allow investors to “without even thinking about it,” make “an average of 239 percent.” With Bitcoin, this strategy was applicable “about five times in the last six years,” the fund manager noted.
Cryptocurrencies, when compared to other financial products, are still volatile investments. Regulatory uncertainty throughout the world is believed to be pressuring the markets, as various businesses fight to stay afloat. As covered, Polish cryptocurrency exchange BitBay was this month forced to move to Malta over a banking blockade.
In early May, for example, South Korean cryptocurrency exchange UPbit was raided by local authorities. Recently, the country’s top court ruled cryptocurrencies could be a forfeitable asset.
