As crypto traders watched their portfolios deteriorate Wednesday, Turkish-born American economist Nouriel Roubini took to social media to reiterate his stance on cryptocurrencies and blockchain, the decentralized technology that underpins them.
Roubini, who famously predicted the collapse in the U.S. housing market and banking system, has been just as bearish on digital currencies since they began their meteoric rise in 2017. In February, he said bitcoin was going to zero and has called bitcoin “the mother of all bubbles,” living up to his “Dr. Doom” nickname.
The New York University professor has frequently voiced his opinions on social media, and as digital currencies unraveled Wednesday, Roubini was at it again, taking a shot at venture capitalist Tim Draper, who thinks a single bitcoin will be worth $250,000 by 2022.
However, those decimated portfolios are showed some life Thursday, after a favorable comment from a leading SEC voice.
Digital-currency owners breathed a sigh of relief Thursday when William Hinman, the director of corporate finance at the U.S. Securities and Exchange Commission, said bitcoin and ether are not securities.
“And putting aside the fundraising that accompanied the creation of ether, based on my understanding of the present state of ether, the ethereum network and its decentralized structure, current offers and sales of ether are not securities transactions,” said Hinman.
Downtrend confirmed, says technical analyst
As technical analysts continue to hunt for the next support level, one noted chart-focused analyst said Wednesday’s break of $6,450 was confirmation we are in a downtrend, and there is no support for another $1,000 drop.
“BTC is now stress-testing its next critical support level at the April lows (6,450), which if broken, would establish the first series of lower lows since 2015, and by definition, confirm a new downtrend of lower lows for BTC,” said Rob Sluymer, managing director and technical strategist at Fundstrat Global Advisors, in a note early Wednesday. “Next support is near 5,500 followed by 3,200.”
Sluymer’s colleague, Tom Lee, managing partner at Fundstrat Global Advisors, is one of bitcoin’s biggest bulls, having a year-end price target of $25,000 for the worlds biggest digital currency.
Some altcoins post double-digit gains
Coins other than bitcoin, commonly referred to as altcoins, followed bitcoin higher after the comments from the SEC executive director.
Ether ETHUSD, -0.42% gained 10.9% to $521.49; bitcoin cash BCHUSD, -0.28% was up 8.1% at $888.90; Litecoin LTCUSD, -1.38% added 10.2% to $101.33; and Ripple’s XRP XRPUSD, -1.84% was up 8.1% to 56 cents.
The Cboe June futures contract expired Wednesday, and the July contract XBTN8, -0.19% closed Thursday up 5.7%, at $6,632.50, while the CME June contract BTCM8, -0.38% finished up 5.8% at $6,635.