The perspective that "Bitcoin" is characterized by speculation and excess liquidity remains prevalent, even after its 35% drop last month. Approximately 80% of fund managers surveyed by Bank of America described the market as a bubble. The survey, which collected views from 207 investors with a total asset value of $645 billion, indicated that "Bitcoin" selling transactions are the second most active trading after commodities.
The survey results also revealed that there are doubts among some professional managers about whether the cryptocurrency is a viable asset class due to its extreme volatility and regulatory uncertainty. Concerns about bubbles are not new to cryptocurrencies, as many investors have expressed skepticism regarding the wisdom of investing in assets lacking a supporting foundation.
Despite the drop in prices, investment banks continue to embrace this emerging asset class. Goldman Sachs announced plans to launch Ethereum-related derivatives for clients, and Cowen plans to offer institutional-grade custody services for cryptocurrencies. The prices also received a boost this week from veteran hedge fund manager Paul Tudor Jones, who reiterated his view that "Bitcoin" is a good hedge against inflation.
Jones, who runs Tudor Investment, stated in an interview with CNBC: "I love Bitcoin as a portfolio diversification. Everyone asks me what to do with my Bitcoin? The only thing I know for sure is that I want 5% in gold, 5% in Bitcoin, 5% in cash, and 5% in commodities."
