The latest Bank of America Fund Manager Survey reveals that about three out of four professional investors believe that Bitcoin (BTC) is a bubble. The fund managers also ranked bitcoin second on the list of the most crowded trades. Lately, investment bank JPMorgan also advised that cryptocurrency as a sector is in a bubble.
The Bank of America Fund Manager Survey for April reveals that most fund managers see bitcoin as a bubble. The survey asks 200 fund managers with $533 billion in assets under management.
Answering the question of whether bitcoin is a bubble, 74% of investors replied “yes.” Just 16% said “no” to the question, and 10% said they either did not know or did not want to answer the question. In comparison, only 7% of investors think that the U.S. equity market is in a bubble. The majority of respondents believe that the equity market is in “a late-stage bull market.”
Chart showing 74% of investors who responded to the survey think that bitcoin is a bubble. Source: Bank of America Global Research, Yahoo Finance
The fund managers who answered the survey also rated bitcoin second on the most crowded trades, with 27% said BTC was the most crowded trade. Technology stocks rank first, with just over three in 10 respondents citing tech as the most crowded trade.
Nonetheless, about 10% of fund managers still believe that bitcoin will outperform in 2021.
Bank of America has been stating that bitcoin is in a bubble for months. This year, Michael Hartnett, chief investment strategist at Bank of America Securities, said that bitcoin looks like “the mother of all bubbles.” In March, the bank’s strategist noted that the only good reason for holding BTC is “sheer price appreciation.”
Lately, investment bank JPMorgan also named cryptocurrency as one of the sectors it believes is in a bubble. Notwithstanding this view, the firm has forecasted that the price of bitcoin could reach $130,000 in the long term.
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