Bitcoin Price in Severe Hangover State: Strategist Questions Bitcoin’s Outperformance Claims, Seeks Proof

Senior Commodity Strategist of Bloomberg Intelligence, Mike McGlone, recently appeared on David Lin’s show and opened up about the massive targets being set for Bitcoin. Mike commented that Bitcoin has recently achieved new highs driven by factors such as the launch of ETFs and the halving event, which created a perfect storm for its price surge. 

However, he noted that Bitcoin is now facing reminders of its highly volatile and speculative nature, as it has been underperforming compared to traditional assets like gold for the past couple of months. 

In his view, Bitcoin and gold are increasingly intertwined in long-term investment strategies due to Bitcoin’s diminishing supply and growing adoption. Despite this bullish long-term outlook, he expressed concern about short-term risks, particularly if broader market corrections occur, where Bitcoin could potentially lead the downturn as a leading indicator.

“It’s (Bitcoin) had a good run, but it had a good reason to make a new high and has a tremendous reason to be in a severe hangover for a long time. People are reminded now that this volatile, highly speculative digital asset is just that, and it’s way underperforming beta for a couple of months now. And I’m afraid that’s going to continue,” he said.

When asked about the recent price targets of $100k and $150k by Standard Chartered, he said for this to happen, beta must continue rising significantly, driven by sustained liquidity injections. Bitcoin’s history ties closely to financial crises and has benefited from prolonged periods of zero interest rates, which are now ending. 

Mike also said he wants proof that Bitcoin will outperform other assets and become less risky. He pointed out that he sees Bitcoin performing poorly compared to traditional assets like beta, which keeps hitting new highs. Instead of leading, Bitcoin now follows market movements upwards.

He warned that while bear markets often signal buying opportunities, current bullish sentiments might be overextended. The analyst also noted that despite Bitcoin’s new all-time highs this year, media coverage and retail interest have been relatively subdued compared to previous cycles, raising questions about market sentiment.

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