Institutional Investors Expect Major Correction in Crypto Market Next Year

Institutional Investors See Crypto Market as the Top Contender for Major Correction in 2022

Many institutional investors are predicting a major correction in the cryptocurrency market next year, a survey published by Natixis Investment Managers shows. Despite seeing crypto as the top contender for a major correction, institutional investors are increasingly warming up to the asset class.

Institutional Investors See Crypto as Top Contender for Major Correction

Natixis Investment Managers published the results of a global institutional investor survey Wednesday. The company polled 500 institutional investors who collectively manage $13.2 trillion in assets for public and private pensions, insurance, foundations, endowments, and sovereign wealth funds worldwide. Nearly 100 institutional investors in the U.S. who manage $1.3 trillion in assets were included.

Institutional investors were asked about which markets will see a major correction next year. While “institutions see the potential for corrections in a range of asset classes and sectors,” the survey findings state:

They think the top contender for a major correction next year will be cryptocurrencies.

Natixis detailed that cryptocurrency tops the list of correction concerns with more than half of institutions surveyed calling for a correction. Next on the list are interest-rate-sensitive bonds (45%), stocks (41%), and technology (39%).

Despite predicting a major correction for the crypto market, institutional investors are increasingly warming up to the asset class, Natixis noted, stating:

Even as crypto is the top contender for correction, institutions are beginning to warm to digital currency.

Natixis added: “Four in ten consider crypto to be a legitimate investment option, and of the 28% who invest in crypto, 90% say they will maintain (62%) or increase (28%) their allocation.” Meanwhile, 87% of institutional investors expect central banks to eventually regulate cryptocurrencies.

A growing number of institutional investors have shown interest in cryptocurrencies over the past months. In May, global investment bank Goldman Sachs said that fear of missing out (FOMO) is driving institutions to bitcoin. In July, a survey by Nickel Digital Asset Management shows that 82% of institutional investors and wealth managers are planning to increase their crypto exposure between now and 2023.

Do you agree with the institutional investors surveyed about a major correction in the crypto market? Let us know in the comments section below.

Financial Adviser Warns Crypto Is ‘One of the Biggest Bubbles Ever’ — Says ‘It’s Going to Be Ugly’

Financial Adviser Warns Crypto Is 'One of the Biggest Bubbles Ever' — Says 'It's Going to Be Ugly'

The president of Payne Capital Management has warned that crypto is “one of the biggest bubbles ever.” Stressing that the crypto market is “becoming a bigger and bigger casino,” he predicts that the bubble will eventually burst and “It’s going to be ugly.”

Crypto Is a Big Bubble Waiting to Burst, According to the Financial Adviser

Financial adviser Ryan Payne, president of Payne Capital Management, talked about the future outlook for bitcoin and the cryptocurrency market on Yahoo Finance Monday.

Payne co-designs his firm’s investment and financial planning strategies while supervising all the financial advisers in his firm. Prior to establishing Payne Capital Management, he spent almost eight years as a financial adviser at Merrill Lynch.

The executive began by agreeing with Berkshire Hathaway Vice Chairman Charlie Munger, who recently stated that the current markets are wilder than the dot-com bubble. Noting that “there are pockets of bubbles being formed,” the financial adviser stressed:

This whole bitcoin thing, this whole cryptocurrency, is one of the biggest bubbles ever.

Munger, who is often called Warren Buffett’s right-hand man, also commented on cryptocurrency, particularly bitcoin. He commended China for banning crypto and said he wishes crypto had never been invented.

Payne noted that bitcoin can still go higher, adding:

There’s too much money out there that can funnel into this market. It’s just becoming a bigger and bigger casino.

“At the end of the day, we’re not using it for that much more commercial use. It’s just more people speculating,” he continued, adding that “it’s very analogous to when the tech bubble burst.”

The president of Payne Capital Management further opined: “The reasons for owning it don’t make a lot of sense because really it’s not a great store of value as we know. It’s extremely volatile. It’s fake scarcity. It’s not like gold that has real scarcity.” He emphasized:

I do think eventually that bubble is going to burst. It’s going to be ugly.

Noting that the global crypto market cap “is somewhere over $2 trillion,” Payne detailed: “When the dot-com bubble burst, those dot-com stocks were worth like half a billion dollars — inflation-adjusted that’s like $1 trillion in today’s dollars. Most of those stocks became worthless. Even Amazon went down 80% to 90% when the tech bubble burst. It took you like 14 years to get back on your money.”

He concluded: “So I do think that bubbles are there. They are pervasive right now. The smart money here is you can get out early. It’s better to be early than late and get into some of those cyclical names which are selling off right now. Diversify your portfolio. Protect yourself because eventually the music’s going to stop and when it does, no one‘s going to tell you ahead of time.”

What do you think about this financial adviser’s advice? Let us know in the comments section below.

Fundstrat’s Chief Strategist Predicts Bitcoin Still Has ‘Exponential Growth Ahead’

Fundstrat's Chief Strategist Predicts Bitcoin Still Has 'Exponential Growth Ahead'

Fundstrat Global Advisors’ head of research says bitcoin still has “exponential growth ahead” of it. While acknowledging recent price swings of the cryptocurrency, the strategist emphasized that bitcoin has so far regained its losses in short periods of time.

Bitcoin Still Has ‘Exponential Growth Ahead’

Fundstrat Global Advisors’ managing partner and head of research, Thomas Lee, talked about the outlook for bitcoin in an interview with CNBC Monday.

Lee is a Wall Street strategist with more than 25 years of experience in equity research. Prior to co-founding Fundstrat, he was J.P. Morgan’s chief equity strategist from 2007 to 2014.

The Fundstrat strategist recommends investment in bitcoin, emphasizing that the cryptocurrency still has “exponential growth ahead” as it becomes more mainstream.

While acknowledging that the price of BTC suffered a decline recently, he insisted that it made more sense to hold the cryptocurrency through volatility rather than trade the fluctuations. He explained:

Every year, bitcoin makes all of its gains in 10 days and if you don’t own bitcoin for those 10 days, you are down 25% a year. To me, the kind of weekend massacre that happened, it’s painful but it’s pretty common.

Last week, Lee commented on Square CEO Jack Dorsey stepping down as the CEO of Twitter. The Fundstrat strategist sees Dorsey’s departure as bullish for crypto. He emphasized that it is still the earliest days for the crypto space, not only for projects like Bitcoin and Ethereum but also “the amount of crypto equities and businesses built around crypto.”

Lee is not the only one who sees an upside to bitcoin. Billionaire Barry Sternlicht, the chairman of Starwood Capital Group, said last week that bitcoin could be worth a million dollars a coin. Meanwhile, Microstrategy’s CEO sees bitcoin becoming a $100 trillion asset class. Skybridge Capital founder says bitcoin will easily trade at $500K, urging investors to buy BTC right now.

Do you agree with Thomas Lee? Let us know in the comments section below.

Billionaire Barry Sternlicht Discusses Bitcoin Price Rising to $1 Million — Calls BTC a ‘Smart’ Hedge

Billionaire Barry Sternlicht Has Over $1 Billion in Crypto — Sees Bitcoin as Smart Hedge

The chairman of Starwood Capital Group, billionaire Barry Sternlicht, has shared his view on how bitcoin could grow to be worth a million dollars a coin. He calls the cryptocurrency a “smart” hedge in a world where the government just keeps on printing money.

Billionaire Barry Sternlicht Believes Bitcoin Could Rise to $1 Million per Coin

Billionaire Barry Sternlicht, the chairman of Starwood Capital Group, talked about the future outlook for cryptocurrencies, particularly bitcoin, Friday while speaking at a Bloomberg event in Miami.

Sternlicht runs Starwood Capital Group, a private equity firm that specializes in real estate investments. The firm has about $100 billion under management in real estate, debt, and energy assets. According to Forbes’ list of billionaires, his current net worth is $4.2 billion.

Noting that he has called his bitcoin position a “great hedge,” the billionaire was asked, “Is that how we all should be thinking?” Sternlicht firmly replied, “Yes.”

He explained that we live “In a world where the government just prints money, and prints money, and prints money, and prints money, and doesn’t seem to have any consequences.” Noting that “Sometimes, that will end,” the billionaire stressed:

The only thing that they can’t make more of is bitcoin.

He added that bitcoin has “never been hacked,” but noted that “It has no real value other than there’s 21 million coins” that are “infinitely divisible.”

In comparison, he pointed out that gold also “really doesn’t have a lot of value,” adding that “You can have your gold jewelry but it could be silver or titanium or platinum.”

Sternlicht opined: “You could see the world saying to the U.S., especially with our political isolationism, they would say China is going to try to knock us off the dollar standard, and they are going to have a lot of countries aligned with them.”

The Starwood Capital executive emphasized: “They are going to try really hard. It’s very obvious. They are going to try really hard to break the dollar standard. If that happens and the dollar devalues, you need one thing that could hold its value.”

While admitting that bitcoin “will go down with the stock market,” he stressed that in his opinion, “it will reverse,” elaborating:

It would go to $1 million a coin. It could do that because everyone, it’s not U.S. investors, the whole world will look at one thing that they can’t make more of and that would be bitcoin.

“There’s no function other than a store of value so having a little investment in bitcoin, I think, might be a smart little hedge in your life because your paper will be worthless, unfortunately,” he warned.

The billionaire then disclosed that he has about 2% to 3% of his net worth in cryptocurrencies. Regarding crypto investment, he said: “If it goes to zero, it won’t hurt me either, it won’t hurt you.” However, he emphasized:

But if it goes to $1 million a coin, you are going to look at the TV and get very upset.

A growing number of billionaires are using bitcoin to hedge against inflation.

Famed hedge fund manager Paul Tudor Jones said in October that he preferred bitcoin over gold. Orlando Bravo, the billionaire who co-founded private equity firm Thoma Bravo, said in September that he is very bullish about bitcoin, expecting it to increase “significantly.”

Last week, Mexican billionaire Ricardo Salinas Pliego said the U.S. “is looking more and more like any other irresponsible third world country.” Salinas tweeted a weekly chart of the total value of the Federal Reserve’s assets (less eliminations from consolidation) and commented: “Wow…look at the scale of fake money creation. Buy bitcoin right now.”

Do you agree with Barry Sternlicht about bitcoin? Let us know in the comments section below.

Huobi Research Report ‘Taper Landed’ Paints Bleak Picture for Cryptocurrency Assets

Huobi Research Report 'Taper Landed' Paints a Bleak Picture for Cryptocurrency Assets

A report issued by the Huobi Research Institute, the investigative arm of the Asian exchange, examines the effect that upcoming changes of U.S. Federal Reserve policy could have on the price of cryptocurrencies. The report, titled “Taper Landed: The Turning Point of The Cryptocurrency Market is Coming,” states that due to the upcoming tapering, the continued growth of high-risk assets (including cryptocurrency) could be difficult to maintain.

Huobi Report Examines Fed Taper Effects

Huobi Research’s latest report, titled “Taper Landed: The Turning Point of The Cryptocurrency Market is Coming,” establishes the possible route cryptocurrency prices could take due to the action of the Federal Reserve taper. The taper — that is, the continual reduction of dollar liquidity in the market due to reduction in bond purchases — could negatively affect the growth of bitcoin and other assets.

The taper discussion started months ago, and according to study forecasts, it could start next June, with a reduction of the purchases of bonds and the end of quantitative easing (QE). This reduction is expected to hit not only bitcoin, but also high-risk assets first, and its effect to move down to more established assets later.

End of Stock-to-Flow

“Taper Landed” also takes a few jabs at the well-known stock-to-flow (S2F) model, which predicts the rise of bitcoin’s price based on its availability and production in the market. The report, which was written on November 24, predicted this model would fail due to its limited consideration of economic elements surrounding bitcoin. William Lee, of Huobi Research, explained:

Why does the “victorious” bitcoin S2F model suddenly fail? Because Plan B only considered the monthly SF ratio of bitcoin and historical bitcoin price data when constructing the model, but ignored the impact of external macro changes on the market.

Lee further explains that the growth in bitcoin’s price has to do with the loosening of economic policies that the U.S. and other governments undertook, ostensibly to save the market during the coronavirus pandemic. But with the start of the so-called taper, and the upcoming interest hike that normally happens after taper periods, this bubble in stock growth and cryptocurrency price hikes could pop next year, according to the report.

If the taper process accelerates, these effects could be felt even more quickly on the market, the study concludes.

What do you think about Huobi Research Institute’s taper study? Tell us in the comments section below.

Virtual Metaverse Plots Outpace Top NFT Collection Sales, Play-to-Earn Tokens Surged in Value This Year

Virtual Metaverse Plots Outpace Top NFT Collection Sales, Play-to-Earn Tokens Surged in Value This Year

During the last seven days, virtual lands sold in the metaverse have outpaced a great number of non-fungible token (NFT) sales. Moreover, metaverse native crypto tokens like axie infinity, sandbox and decentraland and play-to-earn digital assets in general have jumped significantly in value this year.

Metaverse Properties Outpace NFT Collections — Play-to-Earn Tokens Rise

Following the meme-crypto hype, the decentralized finance (defi) trend, and the non-fungible token (NFT) craze, the metaverse has become a big deal. Essentially, a metaverse is a different version of the internet that supports virtual environments, items, collectibles, weapons, and sometimes play-to-earn features. Virtual worlds like Second Life, Minecraft, and Roblox can be considered iterations of the metaverse but in recent times, blockchain technology has entered the realm.

For instance, out of the $2.3 trillion crypto economy, $25 billion of it belongs to play-to-earn (P2E) digital assets. Axie infinity (AXS) is the largest P2E token in terms of market capitalization with a valuation of around $6.5 billion.

While AXS has lost 25% during the last week, AXS is up 20,824% year-to-date (YTD). The second largest P2E token is sandbox (SAND) with a $4.6 billion market valuation. SAND lost 32% this past week but has gained 11,597% YTD.

The third-largest market valuation in terms of P2E assets is decentraland (MANA) with a market cap of around $4.4 billion. MANA has lost 32% this week as well but has gained 3,693% YTD in USD value. Other top P2E tokens in terms of market cap size include gala (GALA), wax (WAXP), illuvium (ILV), and mobox (MBOX).

Staking Land in the Metaverse Can be Expensive — The Sandbox Captures $70M in Weekly Sales

In addition to metaverse and P2E tokens gathering massive value during the last year, in recent times land in the metaverse has been a hot commodity. Metrics from indicate that the NFT market history for the last seven days shows The Sandbox has been the top contender. Sales stemming from The Sandbox metaverse saw more than $70 million in sales during the last seven days.

Virtual Metaverse Plots Outpace Top NFT Collection Sales, Play-to-Earn Tokens Surged in Value This Year

That’s about $10 million more than the sales produced by the Bored Ape Yacht Club (BAYC) NFT collection which saw $59 million. Moreover, The Sandbox sales are much larger than the Cryptopunks NFT collection sales which captured $17 million last week. The virtual reality platform powered by the Ethereum blockchain, Decentraland has seen the sixth largest number of weekly sales with $6.6 million last week.

The biggest sales on Decentraland were land plots and estates worth between $289K to $758K. While The Sandbox outpaced Decentraland sales, land plots sold for much lower values as land exchanged hands this past week for $44K to $68K per plot. However, virtual land adjacent to Snoop Dogg’s Sandbox estate recently sold for $450K in ethereum. The average USD price for The Sandbox metaverse products during the last week was $15K across more than 4,400 sales.

What do you think about the metaverse and P2E tokens gaining a lot of value this year? What do you think about all the metaverse land sales? Let us know what you think about this subject in the comments section below.