Big Short investor says Bitcoin is in a ‘speculative bubble’
There are plenty of Bitcoin bulls evangelizing the digital currency these days, but Michael Burry, the focus of the film and book The Big Short, is not one of them.
Burry, in a now-deleted tweet, warned that Bitcoin’s current levels are unsustainable—and current investors could suffer significant losses.
“$BTC is a speculative bubble that poses more risk than opportunity despite most of the proponents being correct in their arguments for why it is relevant at this point in history,” he wrote. “If you do not know how much leverage is involved in the run-up, you may not know enough to own it.”
Burry knows about bubbles, having made a fortune off the housing market’s collapse in 2007. And he warned that Bitcoin’s recent ascension seemed reminiscent of that time.
“Fads today (#BTC, #EV, SAAS #memestocks) are like housing in 2007 and fiber/.com/comm/routers in 1999,” he said.
Burry regularly deletes his tweets, but he has been quite outspoken on the platform about a number of issues. Last April he decried the coronavirus lockdown. He began tweeting last March, and his comments are closely watched by the financial community, though he does not talk much (if at all) about his own investments.
His bearish remarks come at roughly the same time that Citi gave Bitcoin a boost. A note from analysts at the financial institution said the cybercurrency could be on the verge of going mainstream, despite the many obstacles in its path.
“But weighing these potential hurdles against the opportunities leads to the conclusion that Bitcoin is at a tipping point and we could be at the start of massive transformation of cryptocurrency into the mainstream,” the analysts said.