Michael Burry, the fund manager who gained notoriety from “The Big Short,” has warned crypto investors to expect the “mother of all crashes.”
- Burry, who is famous for betting against the U.S. subprime mortgage market and profiting from the 2007-2008 financial crisis, issued his warning in a series of tweets that have since been deleted, Bloomberg reported Friday.
- His story was made famous in Michael Lewis's 2010 book "The Big Short" and the 2015 film adaptation of the same name.
- "All hype/speculation is doing is drawing in retail before the mother of all crashes. When crypto falls from trillions, or meme stocks fall from tens of billions, #MainStreet losses will approach the size of countries. History ain't changed," he wrote.
- Crypto's problem is in leverage, he said. "If you don't know how much leverage is in crypto, you don't know anything about crypto, no matter how much else you think you know."
- Burry has retracted Twitter posts in the past. In February, he tweeted that Tesla had bought bitcoin as a distraction from concerns raised by Chinese regulators over quality and safety issues of its cars, before then deleting it.
- He also referred to bitcoin as a "speculative bubble," comparing it to housing in 2007 and the internet in 1999, in another tweet he quickly deleted.