Steve Eisman, an investor, declares that cryptocurrency is among the three significant trends of our era – here’s his perspective clarified.
One of the individuals who capitalized on the subprime mortgage crisis in 2008 and made significant profits has identified crypto as one of the three dominant themes shaping today’s narrative. However, despite this acknowledgement, he remains unconvinced about its potential.
During an interview on Bloomberg Television, Steve Eisman from Neuberger Berman highlighted artificial intelligence (AI), infrastructure, and crypto as the major driving forces in the current market. While Eisman appreciates the significance of the first two themes, he does not share the same sentiment towards crypto.
According to Eisman, digital assets are often touted as a safeguard against inflation and fiat currencies. However, he argues that this thesis is undermined by their correlation with risk assets and the Nasdaq.
Eisman questions the motives of crypto owners and their justifications for holding these assets. He asserts that many claim it is a hedge against the collapse of traditional currencies, comparing it to possessing digital gold. However, he argues that if this were true, crypto should perform well on days when concerns about inflation and deficits are high, and the Nasdaq is experiencing a decline. Conversely, on days when the market is optimistic, with NVDIA and the Nasdaq performing strongly and interest rates dropping, crypto should experience a decline. However, Eisman points out that this is not the case, as crypto tends to act in the opposite way to its own narrative. Its correlation with the Nasdaq stands at approximately 75%.
In Eisman’s view, crypto is simply an avenue for speculation. He believes that there is no factual evidence that definitively proves its rightness or wrongness.
In conclusion, while acknowledging the influence of crypto as one of the dominant themes in today’s market, Eisman remains skeptical of its value. He advises investors to conduct thorough research and due diligence before engaging in high-risk investments in Bitcoin, cryptocurrency, or digital assets. The Daily Hodl, where this article is featured, emphasizes that its opinions should not be regarded as investment advice, and that investors should be aware of the risks associated with transfers and trades in these assets.
