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Citadel’s Ken Griffin: Investors Exiting Bitcoin, NFT and Meme Stocks Are Good for the Economy CryptoBlog

According to Wall Street heavyweight Ken Griffin, people exiting the “speculative bubble” that is crypto, NFTs and meme stocks is a positive sign for the US economy.

The founder of Miami-based trading firm Citadel Securities said in an interview Wednesday with CNBC that government subsidies in 2020, in response to COVID-19 lockdowns, led investors to funnel their money into “speculative assets” like NFTcrypto and even stocks.

So-called meme stocks, stocks of companies gaining traction via social media, became wildly popular in 2021 when young traders bought shares previously sold short by hedge funds in the dying video game retailer GameStop – and sent Wall Street into chaos.

In the same year, the market for NFTs, unique tokens that represent ownership of digital assets, became the latest craze. Assets sold for obscene sums of money as celebrities got involved and led to an influx of amateur investors. The new attention of the general public undoubtedly played a big role in the price of Bitcoin and virtually every other coin and token reaching new heights.

But now the bubble has burst, Griffin said, and it’s “healthy” for the US economy.

“Now that we’re past that point and people are starting to spend those savings on travel, going out to eat, enjoying other life items that they want to have, we’re seeing this speculative bubble really recede,” said the billionaire during CNBC’s Delivering Alpha conference on Wednesday.

“And it’s healthy for the economy. Misallocated money in speculative assets doesn’t create long-term jobs, doesn’t help create the long-term prosperity that makes America the country it is,” he said. .

Griffin added that young people, including those who work for him, like crypto because they have a “more libertarian view of the world” and value privacy.

But he said “billions of dollars in companies that will actually go bankrupt, tens of billions” are not good for the markets. A number of crypto companies—including Celsius lender— went bankrupt this year when its business model proved unsustainable, costing investors billions of dollars.

The hedge fund manager has a reputation for criticizing crypto. He once called space a “jihadist call” against the US dollar, and said his company stayed away from digital assets because he didn’t want to “help fund North Koreans”.

Griffin once outbid a group of crypto investors who wanted to use their Ethereum purchase a rare copy of the US Constitution by spending $43.2 million on the document.

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