Peter Brandt on Bitcoin: 50-50 chance of $1MM or ZERO

Peter Brandt, the CEO of Futures/FX trading firm Factor LLC, has tweeted “I think there is a 50% chance it will go to $1MM and a 50% chance it will go to Zero” in Bitcoin.

In 2011, Mr. Brandt was named among the 30 most influential persons in the world of finance by Barry Ritholtz’ website. With nearly 500,000 followers, he regularly tweets “about stuff I’ve learned the hard way”.

Bitcoin’s bullish run of the last few months has triggered new moves in Wall Street and Main Street. Goldman Sachs is relaunching its crypto trading desk and will set up a custody offering. CME Group has launched its Ether futures contract. Canada’s third Bitcoin ETF is about to get listed on the Toronto Stock Exchange (TSE).

In the face of the never-ending enthusiasm in the market regarding Bitcoin, Peter Brandt accepts either fate: $1 million or zero. This analysis implies Bitcoin is a completely speculative asset with absolutely no intrinsic value.

This, however, didn’t stop the 46-year veteran trader from entering the Bitcoin market in 2016. “Full disclosure -I am NOT a $BTC maximalist -In 46 yrs trading, I’ve never seen a more exciting market with a similar narrative. My largest current single non-real estate holding is Bitcoin. Yet, for me, BTC is just another market to be traded, like Beans or T-Notes or Sugar”, he wrote in another tweet.

“The devaluation of the purchasing power of the U.S. Dollar $DX_F has only just begun. This is why Bitcoin $BTC, real estate, U.S. equities, and commodities will continue to trend higher when expressed in $USD fiat terms”, he added in his Twitter account. 

Peter Brandt admitted that the nearly pathological crypto enthusiasm may be a reason to drive away market interest in the number one digital currency. “The single most bearish factor I am presently considering for Bitcoin. Unbridled enthusiasm + FOMO buying usually =s deep and/or long correction Not only is it obnoxious, but it is also stupid If you want the world to take $BTC seriously, then stop acting like children.”

“Either play by the rules or we will shut you down”

While Peter Brandt is happily holding Bitcoin, regulators in the United States have become increasingly hawkish on cryptocurrencies as unregistered trading firms and crypto scams surge with the rising interest in all things crypto.

New York Attorney General Letitia James has recently said: “Too often, greedy industry players take unnecessary risks with investors’ money, but, today, we’re leveling the playing field and issuing alerts to both investors and industry members across the nation. All investors should proceed with extreme caution when investing in virtual currencies. Cryptocurrencies are high-risk, unstable investments that could result in devastating losses just as quickly as they can provide gains”.

“We will not hesitate to take action against anyone who violates the law. Two weeks ago, we filed a lawsuit to shut down Coinseed’s fraudulent operation. Last week, we ended both Bitfinex and Tether’s illegal activities in New York. And now, today, we’re sending a clear message to the entire industry that you either play by the rules or we will shut you down.”

Crypto scammers and fraudsters get indicted

The Department of Justice has recently announced a citizen of Sweden, Roger Nils-Jonas Karlsson (47), pleaded guilty to securities fraud, wire fraud, and money laundering charges.

The DOJ indicted Mr. Karlsson of defrauding over 3,500 victims of more than $16 million with a long-running scheme by which Karlsson and his company Eastern Metal Securities (EMS) convinced victims to send funds using a virtual currency exchange.

John McAfee, again, was indicted for “engaging in a manipulative and deceptive digital asset “pump-and-dump” scheme”. This is the first case brought by the CFTC for a manipulative scheme involving digital assets.