Scott Minerd, CIO and President of Guggenheim Partners, believes that the demise of the FTX crypto exchange will cause more problems for companies and investors.
He reiterated his position that market declines could be beneficial to the industry because they could kill projects without meaning.
Buckle up for more trouble
According to For Minerd, the domino effect that triggered the bankruptcy of FTX could continue in the near future affecting other entities:
“There’s another shoe to drop, I can’t tell you where it is. The reason is that this is like any number of periods where we had easy money and a lot of speculation; the weakest players go down first. Cryptocurrencies were obviously crazy.”
Scott Minerd, Source: CNBC
The failure of FTX has already shaken the operations of numerous organizations, including Genesis and BlockFi. Others, such as Temasek, Multicoin Capital, Paradigm, and CoinShares, reported severe losses due to exposure to the collapsed former giant.
Minerd went on to predict that the cryptocurrency industry will survive the current turmoil, describing the situation to the dotcom bubble in the late 1990s:
“There is going to be a laundering like the Internet bubble. We will have survivors: currency digitization is in its infancy, and how it evolves now will require a regulatory framework to legitimize it.”
Edward Dowd, former CEO of BlackRock, shared similar thoughts earlier this year, claiming only “robust” digital currencies will endure the hard times. He sees Bitcoin as one of the survivors due to its underlying technology, transparency, and the financial independence it provides.
Controversial Minerd Forecasts
Guggenheim’s boss was initially a supreme bull, predicting in 2020, that bitcoin could rise to $400,000. Several months later, he imagined the coin could skyrocket to $600,000.
he drastically change his insight in May 2021, comparing the cryptocurrency market to “tulip mania” in the 17th century.
In July of this year, Minderd claimed that BTC could drop to $15,000 and said that he does not plan to invest in it “anytime soon” due to prevailing uncertainty. The leading digital asset it fell to a multi-year low of $15,500 shortly before FTX archived to bankruptcy, which makes his prediction quite accurate.
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This post FTX contagion isn’t over yet, warns Guggenheim’s Scott Minerd
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