He made a fortune in the US housing crisis. Now billionaire hedge fund manager John Paulson says: All cryptocurrencies will crash – until they are completely worthless.

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“No one should invest in crypto”

Crypto critics often argue that cryptocurrencies have no intrinsic value, that they are pointless and serve no purpose. One of these critics is hedge fund manager John Paulson. The American became rich before the 2008 financial crisis with bets against the US real estate market. Now he says: Bitcoin is not even good for shorting! The massive growth of the crypto industry, Bitcoin’s unprecedented bull run in 2021 – all just hype, according to the IPO guru in conversation with “Bloomberg Wealth with David Rubenstein”:

“Cryptocurrencies, regardless of where they are traded today, will eventually prove worthless. As soon as the exuberance subsides or liquidity dries up, they will drop to zero.”

For the professional investor, there is no doubt: no one should invest in cryptocurrencies. Because, so Paulson:

“There is no intrinsic value of any of the cryptocurrencies except that there is a limited amount.“

Cryptocurrencies without “intrinsic value” – an ancient prejudice that does not coincide with the state of the markets. NFT marketplaces or DeFi portals tie up millions, even billions of dollars in capital. But Paulson stays with his attitude:

“I would say that cryptocurrencies are a bubble. I would describe them as a limited offer of nothing. To the extent that demand exceeds the limited supply, the price would rise. But to the extent that demand falls, the price would fall.“

Bitcoin is even ” too volatile […]to shorten it”” In 2009, his company bet against the US real estate market and the value of subprime bonds due to the asymmetry:

“Asymmetric means that you can lose a little on the downside, but earn 100 times on the upside. Most trades are symmetrical. You can earn a lot, but you also risk a lot. And if you’re wrong, it hurts.”

Interesting: Bitcoin is also commonly referred to as an asymmetric bet. Even with the number 1 cryptocurrency, forecasts assume that an increase in value by 1,000% is possible.

Does Bitcoin crash in September?

Another bearish outlook for Bitcoin is currently provided by the popular crypto analyst Lark Davis. He does not expect a total crash, but considers a massive correction possible. Davis explains this in a new video analysis. Background: In the past, there were always sharp declines in September. in 2020, for example, BTC had to lose 18%. Davis:

“So often in September there is a period of correction. What happened last September? We had a red candle, so the Bitcoin price fell 18% in September…“

The year before, the Bitcoin price had also fallen by 27%. The same 2018: here Bitcoin faced losses of 16%. Davis:

“Let’s go back to 2017 – in the middle of the bull run, it couldn’t be more bullish, everything was mega, mega exciting, everything went to the moon, everyone was a genius and got rich-Bitcoin corrected by 40% in the month of September.”

But Davis expects if then only short-term declines anyway. In his estimation, Bitcoin could even start a new, massive bull cycle with a corresponding trigger. This could be an exchange-traded fund, for example, according to the analyst. Analyst Willy Woo also expects explosive price growth in November at the latest.

You can watch his full video analysis here.

Bitcoin has been mining for days, but the bulls are not beaten. Source: Tradingview.com

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