‘Big Short’ Michael Burry Says Bitcoin Crash Is Only Halfway Through

Michael Burry Interest Rate

Michael Burry, the co-founder of Scion Asset Management, predicted on Twitter that the market fall is about halfway through. Pointing to the massive downfall in the S&P 500, Nasdaq, and Bitcoin prices, Burry predicted that the market went through multiple compressions, with earning compression to follow.

Michael Burry became famous for predicting and profiting off the subprime mortgage crisis of 2008. 

Burry’s Series of Predictions

Burry highlighted that after adjusting the inflation, the S&P 500 is down 25-26%, NASDAQ is down 34-35%, and BTC is down 64-65% so far this year. According to Burry, this downward trend in the market is a result of multiple compressions. 

Recently, Burry also predicted that the bullwhip effect will force the Federal Reserves to revise their interest rates hike. The bullwhip effect refers to an erroneous overestimation of the demand, leading to a stockpile of inventories. Burry believes that the deflationary pulses from the effect will be revealed in the Consumer Price Index, which will lead The Fed to reverse its quantitative tightening. 

What The Future Holds For Crypto

The core Personal Consumption Expenditures data, released by the Bureau of Economic Analysis, came out to be at 4.7%. It increased by 0.3% in the month of May, which was less than what many experts had predicted. 

While the core PCE does not factor in energy and food, it as a sign of cooling inflation. Despite the popularity of the CPI, the Fed prefers the use of PCE to gauge the level of inflation. 

Bitcoin will likely face its worst quarter in a decade. Its 58% drawdown the largest since the 3rd quarter of 2011. Inflation and hawkish monetary policies from central banks are important factors in Bitcoin’s downfall. 

With the SC ruling in the GBTC and SEC lawsuit, along with CPI reveal on the 13th of July followed by the Q2 reveal on the 28th of July, the next month will be of key importance to the crypto community.

The post ‘Big Short’ Michael Burry Says Bitcoin Crash Is Only Halfway Through appeared first on CoinGape.

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