Asian demand is said to be driving the current Bitcoin spike with Japanese Yen dominating trading volume.
According to the founder of the $27 billion hedge fund Citadel, Ken Griffin, the bitcoin frenzy resembles Holland’s tulip mania centuries ago. And while Griffin doesn't think Bitcoin is a fraud he is worried about how the ballooning cryptocurrency bubble will end.
Meanwhile Michael Novogratz the former Fortress hedge fund manager said that bitcoin can multiply more than four times in roughly the next 13 months. «Bitcoin could be at $40,000 at the end of 2018. It easily could,» Novogratz said on CNBC's Fast Money.
The Rising Crypto Tide
Cryptocurrencies have soared in popularity, there are now more than 1,000 in existence with an aggregate value greater than the market capitalisation of IBM. However unlike commodities such as oil more bitcoin cannot be produced to meet the insatiable demand since the digital currency's supply is limited to just 21 million coins.
And as Bitcoin soars the whole gamut of cryptocurrencies is being pulled higher. The second most notable crypto ethereum has also taken off on its own relentless vertical rally.
UBS: «Beware the Bitcoin Bubble»
Of course not everyone shares the same views, least of all global investment managers. In the most recent UBS Wealth Management's chief investment office report on Cryptocurrencies, «Beneath the Bubble,» Sundeep Gantori, equity analyst, UBS Wealth Management remains to be convinced.
Gantori and his team are highly doubtful whether crypto's will ever become mainstream currencies. Companies and individuals need to pay tax receipts in government-issued currency, and the potentially unlimited crypto-money supply, pose significant barriers to widespread adoption he says in the report.
