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Pantera Capital CEO said that Bitcoin is selling for 36% below the fair value.
Chief Executive Officer of Pantera Capital, Dan Morehead has urged newbies and investors who wish to purchase Bitcoin, to do it now. According to the CEO, the Bitcoin market is currently below trend and described it as the best time to buy for new investors.
The Pantera boss on social media platform Twitter yesterday, tweeted a chart which showed Bitcoin’s deviation from the 11-year trend and highlighted the fact that Bitcoin just touched over trend value during its recent peak and has only been “this ‘cheap’ relative to its trend 20.3% of the past 11 years.” Morehead added that Bitcoin is selling for 36% below the fair value which is an undervaluation that has only been seen 20.3% in Bitcoin’s existence. “It’s best to buy when the market is below trend,” Morehead stated. “Now is one of those times.”
According to Pantera Capital, Bitcoin has spent just 10% of its existence at 500% above the “fair value” and has gained 39% of all inflows during these extremely rare periods. The firm also added that Bitcoin has spent 4% of its time trading north of 775% of fair value, again pulling in 28% of all inflows during those occasions.
Morehead also shared a link on his page to Pantera Capital’s blockchain letter dubbed the “June investor letter” which highlights China’s Bitcoin crackdown, Tax Day, and billionaire and Tesla CEO Elon Musk’s 180-degree turn on the apex cryptocurrency as factors for the recent decline in blockchain markets. The letter described China’s multiple crypto bans as a ‘movie we’ve seen before,’ adding that investors who sell on China “ban” usually end up regretting it citing previous years (2013, 2017, 2021) which China banned crypto which ended pushing the price to of the digital coin up.
On Tax Day, the letter noted that it can be important for the prices of cryptocurrencies, and highlighted Bitcoin’s market performance before and after Tax Day on two different occasions. “That’s about how long it takes to get your money out of an exchange and to your bank. The Bitcoin market hit a local low near $30,000 two days after Tax Day,” the letter stated. The letter also stated that prices fall leading up to Tax day and advised investors to “Resist the urge to close down positions” but only if they have the emotional and financial resources, go the other way.
Pantera stated that humans have an innate herd instinct and going with the momentum is just part of human nature.