A 25 percent growth in the Bitcoin’s price has been predicted by CEO of DoubleLine Capital- Mr. Jeffrey Gundlach. His expertise in investments in the bonds has earned him the title- ‘Bond King.’ The Bond King who oversees 200 Billion U.S. Dollars in assets, has predicted that there is a possibility of the Bitcoin’s rates to rise to 5k U.S. Dollars. For the other crypto assets, Gundlach foresees more turbulence for them this year. He said that due to increased bond results, it would hurt the stocks. He based this prediction based on the execution of the ‘tightening agenda’ by the Federal Reserve. As per the reports from CCN, the article from Federal Reserve said the following-
“Consider now the bearish case for Bitcoin. This outlook is based on the view that Bitcoin has no fundamental value and that sooner or later the market will recognize this fact. IN our view, one can accept that Bitcoin trades above its fundamental value without claiming that its fundamental value is zero. Many securities trade above what might be considered their fundamental value. Gold, for example, trades above its value as measured by its industrial applications.”
As per the reports obtained from CNBC, Gundlach said the following in a webcast called- ‘Just Markets’-
“I do not recommend anything with Bitcoin. […] But if you want to speculate, I think it could make it to 5000 dollars. Talk about an easy 25 percent.”
Gundlach has not specified any specific time around which the world’s largest digital currency would take a U-turn regarding its prices. Currently, the cryptocurrency is facing a low in its market value with a dip of 7 percent in comparison to its monthly high of 4,200 U.S. Dollars, as recorded on January 8th. According to crypto exchange Bitstamp, Bitcoin is currently trading below 3800 U.S. Dollars. The ‘Bond King’ also had another advice for the investors. He thinks after looking at the corporate and the government debt in the United States; the investors should bin the junk bonds. He said-
“Use the strength we have seen in the junk bonds as a gift and got out of them. Investors need to go into strong balance sheets. […] to survive the zigzag of 2019.
Jeffrey Gundlach also included Goldman Sachs’ chart in his webcast. The percentage of the GDP of the U.S. federal government’s debt has exceeded the percentage of GDP of the household debt. Even after the record high of the U.S. corporate debt about the GDP, it has not been able to surpass the percentage of the gross domestic product of the U.S. household debt; as per reports obtained from CCN.
Amongst so many crypto market predictions going around, the prediction of the ‘Bond King’ holds extra weight given his predictions for the last year stood true to the test of time. For instance, last year, Gundlach predicted about the great U.S. stock market sell-off, that had a major impact on S&P 500 index massive downturn on 24th last month. Although since the start of this new year, there has been a 2 percent rise in the index.