Dan Morehead, the founder of crypto-oriented investment firm Pantera Capital Management, says now it’s a good time to buy Bitcoin and other cryptocurrencies, given that most of them are at their bottom right now. Bitcoin has been fluctuating around $7,500 at the beginning of June, down more than 60% from its all-time high at above $19,500.
Morehead told CNBC’s Fast Money:
“All cryptocurrencies are very cheap right now.”
“It's much cheaper to buy now and participate in the rally as it goes,” he said.
Bitcoin seems to be moving through another correction amid regulatory concerns, which might represent a discount price for cryptocurrency investors.
“Many institutions are essentially buying the rumor and selling the fact,” Morehead said, referring to rumors about potential regulation from the Securities and Exchange Commission (SEC).
“Get invested now so that in three, four, five months when the institutional, quality-regulated custodians that we're hearing about come online, they'll already have their positions,” he added.
According to Morehead, investors could buy a cryptocurrency once it breaks its 230-day moving average, which is a technical indicator, and hold it for one year. This might generate an average 239% return, he says.
Pantera Capital was founded in 2013 and has since then invested in cryptocurrency and blockchain-oriented firms. In mid-April, the hedge fund announced that its primary fund had lost about half of its value in March, after a steep downtrend in Bitcoin’s price.
On Tuesday, Bitcoin fell to the lowest level since April 12. However, it left that bottom after strong fears over a political and bond crisis in Italy. Last weekend, two anti-establishment parties, Five Star Movement (M5S) and “Lega,” had a failed attempt to create a new government, which could lead to an early election. Investors were concerned that the early voting could mean a referendum on the country’s membership in the EU and eurozone. The news put pressure on euro, with EUR/USD falling to the lowest level since November 2017. The panic had a visible impact on Bitcoin, which gained over 5% during the day.