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Has the CIO of Guggenheim lost faith? Once predicted Bitcoin to reach $400,000, now compares it to tulip mania

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Has the CIO of Guggenheim lost faith? Once predicted Bitcoin to reach $400,000, now compares it to tulip mania

The Chief Investment Officer of Guggenheim Partners, an investment giant overseeing over $310 billion in assets, changed his previous views on Bitcoin and cryptocurrencies yesterday after the cryptocurrency market crash, referring to them as "tulip mania."

Guggenheim CIO: Bitcoin is Like Tulip Mania

Following yesterday's market crash, Guggenheim Partners' Chief Investment Officer, Scott Minerd, posted early this morning:

"Cryptocurrency has proven to be like tulip mania. As prices soar, cryptocurrencies, like tulips, will double until market supply exceeds demand."

Although the collapse of cryptocurrencies does indeed prove the immaturity of the market, attributing price drops to market supply seems to contradict the actual situation. Robert Leshner, founder of Compound Finance, stated:

"Scott's statement is completely wrong. The supply of cryptocurrencies (Bitcoin) and crypto assets (ETH, COMP, etc.) does not increase with price. It is as absurd as saying that stocks would issue more shares as demand increases."

Another prominent cryptocurrency YouTuber with over 300,000 followers, Lark Davis, commented below, sarcastically pointing out that Guggenheim had previously announced plans to invest hundreds of millions of dollars in Bitcoin but seems to lack even this basic knowledge, which is shocking.

Changing with the Wind

Guggenheim's views on Bitcoin and cryptocurrencies have been quite inconsistent. According to previous reports, Guggenheim announced its intention to buy Grayscale Bitcoin Trust (GBTC) last November. In December, the company's Chief Investment Officer, Scott Minerd, mentioned in an interview:

"Our fundamental research indicates that the value of Bitcoin should be $400,000."

He even added that the estimated value of $400,000 for Bitcoin comes from its inherent scarcity, relative valuation to gold, many similar attributes to gold, and its unique value in trading. In February, during an interview with CNBC, he mentioned that over the past decade they have been closely monitoring Bitcoin but did not believe its scale was sufficient to attract institutional inflows. However, as its market value grew and based on their fundamental research, he believed that, compared to gold, Bitcoin could grow to $400,000 to $600,000 in terms of scarcity and market value.

However, Scott Minerd also emphasized at the time that the rapid rise of Bitcoin from $20,000 to $40,000 did indeed seem speculative. He stated that he did not really see large institutions such as BlackRock and Guggenheim supporting the existing market value with their investments in Bitcoin. Scott Minerd bluntly said:

"Bitcoin has a record of multiple 50% pullbacks, and if it happens again, he would not be surprised."

Now, Bitcoin has experienced the 50% pullback as Scott Minerd mentioned, but he has changed his tune to call it tulip mania, a far cry from his initial statement of "not being surprised."