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Encryption issues, leverage, street, Michael Bury, Michael Bury Bitcoin, Michael Bury crash, Michael Bury crypto, Michael Bury cryptocurrency, mother of all crashes, retail investors, Wall Street
Michael Burry, a hedge fund manager known for predicting the 2008 financial crisis, warned that this is the “mother of all crashes.” He further explained that the problem with cryptocurrencies is leverage.
Michael Burry, a well-known investor and founder of Scion Asset Management, a private investment company, shared his views on the direction of the market last week.
Burry is best known for being the first investor to foresee and profit from the US subprime mortgage crisis that occurred between 2007 and 2010. He was introduced in the book The Big Short by Michael Lewis about the mortgage crisis, which was adapted into a movie starring Christian Bale.
The founder of Scion Asset Management wrote on Twitter on Thursday:
All the hype/speculation is to attract the retail industry before the mother of all collapses. The #FOMO parabola will not be resolved horizontally; when cryptocurrencies fall from trillions of dollars, or meme stocks fall from tens of billions of dollars, the loss on the street will be close to the size of the country. History has not changed.
He also commented on cryptocurrency, asserting that “Like most things, the problem with cryptocurrency is leverage.” The famous investor further believes, “If you don’t know how much leverage crypto has, then you have nothing to do with crypto. Know, no matter how much you think you know.”
Burry has previously stated that he does not hate Bitcoin, but is worried that the government will vigorously crack down on cryptocurrencies. He warned in February that “during the inflation crisis, the government will take action to suppress competitors in the currency sector.”
While emphasizing “I don’t hate BTC”, Burry said that, in his view, “in a world where the law is violent and the ruthless central government has a lifeline interest in currency monopoly, the long-term future of decentralized encryption is fragile. Despite this, he said that he is not shorting BTC because “anything is possible in the short term.”
Burry is not the only one who foresaw the collapse. Last week, rich dad poor dad writer Robert Kiyosaki warned that “the biggest bubble in world history is getting bigger and bigger” and that “the biggest collapse in world history” is coming. The famous author expects that the price of Bitcoin will drop to the level of $24,000, where he will buy more BTC.
What do you think of Michael Burry’s predictions and his views on cryptocurrencies? Let us know in the comments section below.
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