Guggenheim Partners Chief Investment Officer Scott Minerd shocked Bloomberg TV hosts Wednesday afternoon when he said his firm's fundamental analysis shows bitcoin should be worth $400,000.
- "Our fundamental work shows that bitcoin should be worth around $400,000," said Minerd. "Whoa!" responded one of the hosts.
- That sky-high price target is based on two things, according to Minerd: the asset's scarcity and its relative value to gold as a percentage of gross domestic product.
- "Bitcoin has a lot of the attributes of gold and at the same time has an unusual value in terms of transactions," Minerd told Bloomberg TV.
- Guggenheim made the decision to start allocating to bitcoin when the leading cryptocurrency was trading around $10,000, Minerd said.
- Minerd said allocating to bitcoin, given its current price above $20,000, is "a little more challenging."
- Guggenheim Partners manages more than $230 billion worth of assets.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.