Bitcoin Will Not Reach $100K: Allianz’s El-Erian Says

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Mohamed El-Erian – Chief Eco­nom­ic Advis­er at Allianz – thinks bit­coin will nev­er emerge as a glob­al reserve cur­ren­cy, and its price will not sur­pass the $100K milestone.

Still, he believes the cryp­tocur­ren­cy sec­tor will sur­vive the ongo­ing bear mar­ket and remain a vital part of “the ecosys­tem of payments.”

Bitcoin Isn’t Going to the Moon

In a recent inter­view for CNBC, El-Erian described bit­coin as a tech­no­log­i­cal inno­va­tion that reached its peak (near­ly $70,000 in Novem­ber 2021) thanks to the huge enthu­si­asm among investors, over-con­sump­tion, and over-pro­duc­tion. How­ev­er, the cryp­to win­ter and the adverse macro­eco­nom­ic events ceased this progress, and the ecosys­tem is “rein­forc­ing itself” currently.

Accord­ing to the econ­o­mist, investors should wel­come the recent rel­a­tive sta­bil­i­ty of the asset, which indi­cates that the worst of the bear mar­ket has already passed.

In his view, bit­coin and some of the alt­coins will over­come the issues if watch­dogs impose appro­pri­ate reg­u­la­tions. Nonethe­less, he does not think the price of the lead­ing cryp­tocur­ren­cy will sky­rock­et beyond the $100K lev­el, nor will it receive mas­sive adop­tion from institutions:

“To be clear, I do not think that bit­coin will become a glob­al cur­ren­cy, I don’t think it will get mas­sive adop­tion. When peo­ple say it will reach $100,000, $200,000, $300,000, they assume mas­sive adop­tion: you are not going to get that.”

Despite his some­what bear­ish stance, El-Erian was once a HODLer. He pur­chased bit­coin dur­ing the cryp­to win­ter of 2018, when the asset stood at around $3,000, and sold his posi­tion when it soared to $19,000 in 2020.

Mohamed El-Erian
Mohamed El-Erian, Source: Twitter

The Opposite Corner

A $100,000 price tag per one bit­coin is a mas­sive mile­stone for the asset, and many pro­po­nents have pre­vi­ous­ly spec­u­lat­ed on when (not if) it will go there.

Michael Say­lor pre­dict­ed a bright future for bit­coin, main­tain­ing it is head­ed toward $1 mil­lion. He went fur­ther, describ­ing it as “unique” as no such net­work pro­vides the same lev­el of security.

Even some indus­try out­siders, like Zak Pendl – co-head of Glob­al FX at Gold­man Sachs, fore­cast­ed a sim­i­lar faith for the cryptocurrency.

Mike McGlone – Senior Com­mod­i­ty Strate­gist at Bloomberg Intel­li­gence – claimed in Octo­ber that the asset will sky­rock­et to $100K in five to ten years.

“The key thing right now is it’s get­ting pound­ed, but it’s one of the most dis­count­ed it’s ever been on 100-week and 200-week mov­ing aver­ages, and it’s sim­ple facts of sup­ply demand and adop­tion,” he added.

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