As the price of Bitcoin continues its dip to $5,800, one economist thinks that it may be heading into buying territory.
When asked at what price he might consider buying the cryptocurrency known as Bitcoin, Allianz chief economic adviser Mohamed El-Erian told CNBC Friday: “Around $5,000.”
The prediction comes as the price of Bitcoin has fallen significantly since the start of 2018. Riding on a wave of optimism and sudden interest from the general public, the value of the cryptocurrency rose to touch $20,000 in December in some markets. Since then, the price of the asset has fallen by 71% amid greater cryptocurrency regulation from nations, including the U.S. and Japan.
The former PIMCO CEO said he expects Bitcoin’s most fervent believers to potentially buy into the cryptocurrency — pushing the asset’s price northward.
“I don’t think you get all the way back to $20,000, but I do think that you need to establish a base whereby the people who really believe in the future of Bitcoin consolidate and then that provides you a lift,” he said.
Though pointing to the difficulty in valuing the cryptocurrency, El-Erian noted that his decision to point to the $5,000 figure was “a gut feeling.”
Though El-Erian’s rationale about why Bitcoin’s price could rise further, does seem reasonable. Major Bitcoin bulls have thrown out dramatic predictions about the value of the cryptocurrency, with venture capitalist Tim Draper saying he expects the value of the digital asset to reach $250,000 in four years. Pfeffer Capital’s John Pfeffer meanwhile, has said he expects Bitcoin could eventually reach $90,000 or more.
If they are indeed right, then such crypto bulls will certainly have the last laugh. Whether they actually buy into the dip however, remains to be seen.
Correction: This article has been updated to more accurately reflect John Pfeffer’s outlook on Bitcoin.