Legendary investor Mark Mobius is warning the world that should bitcoin ever experience a sharp decline in the coming future, tech stocks would be struck “very badly” by the move.
Mark Mobius on Bitcoin: It Can’t Fall!
Today, the price of bitcoin is back up to $57,000 per unit. Thus, the currency is once again at the all-time high it attained in early February. However, the currency gave us a bit of a scare following that time considering it staggered and fell below the $50,000 line not long after that.
Many analysts couldn’t help wondering if perhaps the meteoric rise had occurred too swiftly, and that the asset wasn’t able to keep up such momentum within the time allotted. The currency drifted all the way down to the mid-$40,000 range, thereby losing more than $10,000.
Now, the currency is back up likely due to the sudden news that another stimulus payment is on its way to most Americans’ bank accounts. Investors are surely breathing a sigh of relief right about now, but Mobius is warning that things cannot fall to unprecedented levels like they did in 2018. Otherwise, we can expect to see many aspects of our economy take a nasty turn.
In a recent interview, Mobius claims:
One of the things I fear, believe it or not, is a decline of the bitcoin price. I think the relationship between bitcoin prices and the tech market is quite close… Watch the indicator.
Right now, many tech stocks appear to have inadvertently tied themselves to the number one digital currency by market cap. A big one, Tesla, appears to rise and fall whenever the cryptocurrency does, suggesting the correlation between both assets is stronger than ever. This could potentially have something to do with the $1.5 billion purchase CEO Elon Musk recently made.
Another one is the software firm MicroStrategy, which at press time, has purchased nearly $5 billion worth of the digital asset over the course of seven months. Either way, wherever bitcoin goes, tech stocks are likely to follow according to Mobius. He further comments in the interview:
Hopefully [bitcoin] stays up. I am not predicting or wishing it goes down, but I just hope it stays up because tech stocks then will be able to revive.
Many Tech Stocks Are Tied to BTC
Many investors believe that the bull run bitcoin has been “trapped” in for the past year isn’t quite over. While things looked scary a month ago, the fact that the currency has once again reached its $57,000 all-time high is giving a lot of traders hope. Alex Kuptsikevich – senior financial analyst at FX Pro – stated:
After dipping as low as $53,500, buyers have re-entered the main stage and pushed bitcoin to $57,000. There is a good chance that the benchmark cryptocurrency will head into territory above $60,000.