Bitcoin has lost 80% of its market capitalization amidst a market-wide crash this year. But Spencer Bogart believes the digital currency can still correct up to 1328% from its current value.
The Blockchain Capital partner told CNBC that he expects bitcoin to touch $50,000 in the future, similar to what he predicted during the digital currency’s famous bull run in 2017. However, this time, Bogart shied away from giving any timeline for his projection.
“At Blockchain Capital, we are long-term venture investors, so we are never doing short-term price targets,” he explained.
“Bitcoin does not make a kind of price-to-earnings or price-to-value revenue that normally puts an upper bound or a ceiling on a typical kind of early-stage technology company. Bitcoin can surely reach that high. But how long will it take – we are not sure yet.”
In 2017, the Bitcoin rally towards $20,000 high has provoked many investors to set higher upside targets for the digital currency. Mike Novogratz, a Wall Street investor, for instance, had predicted that bitcoin would peak up to $40,000. Thomas Lee, the co-founder of Fundstrat, had also set its upside target towards $25,000. However, the digital currency toppled right where it was supposed to cement its foothold, crashing from an all-time at $20,000 to this year’s current low near $3,200.
The eventual crash led critics to believe that malicious actors artificially pumped bitcoin and the rest of the crypto market. The US Justice Department later launched an investigation against BitFinex-backed stablecoin Tether for allegedly pumping the bitcoin value in spot markets.
Bogart somewhat blamed the inefficiencies of retail markets for causing wild price swings in the bitcoin market, stating that a retail-driven market is likely to go a bit high on a bullish sentiment and a bit low on a bearish view.
“The reality is that fundamentals have not changed,” he explained.
“2018 has been a fantastic year for bitcoin. Forget prices. This is the first year in which we started to move to scale bitcoin with the Lightning Network where you can transact extremely quickly and extremely cheaply.”
Bogart backed his bullish calls by the allegedly increasing institutionalization of bitcoin, bringing up some of the most influential names from the mainstream finance that have directly or indirectly invested in the cryptocurrency space. The list included endowments like Yale, Harward, and MIT, that invested in crypto funds this year, and financial markets like Nasdaq and NYSE that are about to launch their bitcoin-enabled products in 2019.
“And lastly,” Bogart added,
“probably the most encouraging thing is the quality of the talent we are seeing entering the space. If you talk to the young people, it has caught their attention. And some of the brightest and smarted are saying, ‘I wanna work on Bitcoin.'”
Bogart expects Bitcoin will hit $10,000 by the end of 2019.