Bitcoin, the world’s most popular cryptocurrency, is double the price it should be at fair value, according to the Chief Investment Officer of ByteTree.
Charlie Morris of ByteTree, a provider of digital asset data, made the statement earlier today at the Token2049 conference in London, where he met with representatives from Coinbase and Galaxy Digital to discuss the uptake of crypto currencies across Europe (panel above).
When asked for his thoughts on Bitcoin’s price Morris said that Elon Musk’s $1.5bn Bitcoin investment in February has caused the asset to become highly valued.
Sluggish network activity since China’s crackdown on Bitcoin mining in May has caused price to fall “out of kilter with events,” Morris said.
“What we see is this elevated level of premium since China left,” Morris explained. “The coin has not adjusted downward as much as the network has.”
While surging transaction value aligned with price increases between February and July, when price topped $60k and weekly transaction value touched $80bn, price is now above $55k despite transaction value hovering at around the $45bn.
“A proven investor might wait for an opportunity for Bitcoin to be cheap. There are two ways that it can become cheap: one is the network grows and catches up with price, the other is price comes down to network,” Morris explained.
According to ByteTree trading data, Bitcoin is currently at a price premium of 105 per cent and was last at a fair value in May 2021, following the market wide price correction.