January 23, 20183min1188

Was Jordan Belfort correct about BTC?

Former stockbroker compared cryptocurrency “bubble” to tulip mania and claimed that market will eventually collapse.

Jordan Belfort believes the cryptocurrency is in a bubble and could be set to plummet in value soon.

The former stockbroker, whose market manipulation and fraud crimes in the 1990s were subject of the 2013 film Wolf of Wall Street starring Leonardo DiCaprio, claims Bitcoin is a scam.

He told the Financial Times “Promoters are perpetuating a massive scam of the highest order on everyone.

“Probably 85 per cent of people out there don’t have bad intentions but the problem is, if 5 or 10 per cent are trying to scam you.”

The crypto-currency has exploded in value since the beginning of 2017, with one Bitcoin now worth more than $10,300 at the current exchange rate.

Mr Belfort said he expected the price of Bitcoin to rise further in the short term before an eventual collapse in the market.

He likened it to Holland’s “tulip mania”, where the value of tulip bulbs grew exponentially in the 17th Century before a rapid fall in prices.

In an interview with CNN, he said: “I think it’s a huge danger right now that people are looking at this as the next great thing, it’s a bubble for sure.

“The next stage, you will see it really skyrocket, there will be a short squeeze, it will go even higher and then eventually it will come caving in, it’s almost a guarantee.

Mr Belfort made those remarks in December of 2017 but his prediction hasn’t quite panned out just yet. We are seeing an increasing number of red days recently without a clear culprit. Sure we’ve seen the usual suspects like China, South Korea and even India sending out a few negative signals, but there hasn’t really been anything major.

But still, he said that 5 to 10 per cent of people are trying to scam you and that should not be ignored. However, considering that the bubble which popped and sent him to jail lasted around 7 years, we can expect the crypto “bubble” to still have some way to go first.

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