Photo: Shutterstock/Legendary investor ‘fears’ infinite growth of bitcoin price
Bitcoin (BTC) recently reached a new all-time high (ATH). Now the question is whether the digital currency can continue to rise. The founder and CEO of Pershing Square Capital Management, Bill Ackman, is optimistic and outlined a scenario in which BTC could rise further.
Ackman describes a cycle in which the price increase of bitcoin leads to more mining activity and therefore higher energy consumption. According to the CEO, this then causes energy costs and inflation to rise.
Bill Ackman emphasizes that this can potentially lead to an infinite spiral. The BTC price could continue to rise and energy costs continue to increase. Ultimately, Ackman says, an economic collapse will be inevitable.
A scenario:
Bitcoin price rise leads to increased mining and greater energy use, driving up the cost of energy, causing inflation to rise and the dollar to decline, driving demand for Bitcoin and increased mining, driving demand for energy and the cycle continues.
— Bill Ackman (@BillAckman) March 9, 2024
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Criticism Michael Saylor
On X, the crypto community went crazy over the Ackman’s comment. Michael Saylor, who owns billions of dollars in BTC through his company MicroStrategy, offered to talk directly to Bill.
Saylor believes that miners actually reduce electricity costs for consumers, and therefore do not increase them as the CEO suggests. He advised Ackman to buy bitcoin, an investment in which the CEO has largely stayed away.
The managing chairman of MicroStrategy sees BTC shifting from ‘better gold’ to a possible competitor for the S&P 500 stock index. With Bitcoin’s current market value around $1.3 trillion, versus the S&P 500’s $40 trillion, Saylor sees potential for the digital currency beyond just a safe haven.
JPMorgan analyst concerned about BTC rise
Bitcoin’s explosive rise has not brought joy to everyone, especially JP Morgan analysts. They predict that this significant price increase could prevent the US Federal Reserve (Fed) from lowering interest rates in the short term.
Marko Kolanovich, chief strategist at JP Morgan, points to excessive speculation as the driver behind this price increase, which could foreshadow that it is not appropriate to cut rates at this time given the risk of reigniting inflation.
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2024-03-10 20:46:37
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