'Big Short' investor Michael Burry slams bitcoin as a 'speculative bubble' - and says a crash is coming
Michael Burrydescribed bitcoinas a "speculative bubble."
- The "Big Short" investor grouped it with
electric vehicles, SAAS, and meme stocks.
- He compared the boom in those assets to the dot-com and housing bubbles.
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Bitcoin's price has surged to unsustainable levels, and buyers have taken on dangerous amounts of debt, Michael Burry cautioned in a recent tweet.
"$BTC is a speculative bubble that poses more risk than opportunity despite most of the proponents being correct in their arguments for why it is relevant at this point in history," the investor wrote before deleting the tweet.
"If you do not know how much leverage is involved in the run-up, you may not know enough to own it," he added.
Burry is best known for his billion-dollar bet on a housing-market crash in the mid-2000s, chronicled in the book and the movie "
In a tweet on Saturday, the Scion Asset Management chief compared the hype around bitcoin, electric vehicles, software-as-a-service companies, and "meme stocks" like GameStop and AMC to the housing and dot-com bubbles.
"Fads today (#BTC, #EV, SAAS #memestocks) are like housing in 2007 and fiber/.com/comm/routers in 1999," he said.
The enormous buzz isn't entirely unfounded, Burry said, but he doesn't expect it to last.
"On the whole, not wrong, just driven by speculative fervor to insane heights from which the fall will be dramatic and painful," he said.
Burry doubled down on his bearish stance in other tweets last week.
"Those saying me and Munger and Singer are so out of touch are not considering that we have seen this all before, and not just once," he said, referring to recent warnings about market speculation from Charlie Munger - Warren Buffett's business partner - and the hedge-fund billionaire Paul Singer.
"The market is dancing on a knife's edge," he said in another tweet.
Burry said in February that he didn't "hate" bitcoin but had doubts about its long-term prospects. He said he expected authorities to squash threats to their currencies and launch their own digital notes and coins.
The Scion chief added that he wasn't short bitcoin, as "anything is possible" in the near future. He was short Tesla as of December, and he cashed out his GameStop shares last quarter after laying the groundwork for the spike in GameStop's stock price in January.
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