More than four in five (81%) of fund managers believe Bitcoin is in a bubble, according to a recent survey published by Bank of America.
In addition, the survey found that purchased commodities are now the “most congested trade”, with purchased Bitcoin coming in second. Commodities are raw products such as oil, gold, silver and lumber. Precious metals are considered an effective protection against inflation, which has become a growing fear of late.
The bank surveyed a total of 224 fund managers with more than $650 billion in assets under management.
However, not everyone is convinced of the collective skepticism demonstrated.
“This research demonstrates that the lack of understanding of what issues Bitcoin solves is still prevalent in certain industries – it’s still seen as just another asset to be traded by some at the moment,” Jason Deane, an analyst at Quantum Economics, told Decrypt.
He added that “the fundamentals support the position that Bitcoin is ready for significant price appreciation in the future.”
Bitcoin remains a volatile bet
The Bank of America research comes amidst a Bitcoin price roller coaster.
Currently quoted at $40,000, BTC has risen 20% over the past week, but has also seen a 14% drop in the past month. At its lowest point in the past 30 days, Bitcoin dropped to $31,000.
In addition to Bitcoin’s price volatility, the leading cryptocurrency has also undergone more thorough regulatory scrutiny.
Just yesterday, a member of the IRS Cyber Crimes Unit, Chris Janczewski, told Decrypt that the agency is watching Telegram chats closely as a potential way for criminals to move dirty funds.
Last week, the International Monetary Fund threw cold water on the El Salvador project, saying the measure raises “a number of macroeconomic, financial and legal issues.”
However, it is not all bad news for the market.
Last weekend, Tesla CEO Elon Musk said Tesla would start accepting BTC as payment once again if miners committed to using 50% clean energy. His announcement is the latest in a long series of statements about the current state of the industry. Last month, when Tesla stopped accepting Bitcoin, Elon Musk’s tweets were widely credited with contributing to Bitcoin’s price drop.