The study reveals that “Long Bitcoin” is the most crowded trade, demonstrating that traditional markets seek greater exposure to cryptocurrencies. Michael Hartnett says that Bitcoin is “the mother of all bubbles” and that investors bet on it for “sheer price appreciation.”
According to a survey that the Bank of America (BoA) published in recent days, “Long Bitcoin” is the most crowded trade. However, 75% of fund managers consider that the pioneering cryptocurrency is in a bubble zone.
In April, “Long Bitcoin” was the second busiest trade while the busiest was “Long Tech”.
The Most Crowded Trade among Investors Is “Long Bitcoin”
Many may have doubts about the level of popularity of Bitcoin in the market at present. They just need to see the results of the most recent Bank of America fund manager survey.
Between May 7th and 13th, the Bank of America surveyed 216 fund managers with USD 625 billion worth of total assets under management (AUM).
The results of the consultation reveal that fund managers consider “Long Bitcoin” to be the most crowded trade at 43%. This allows seeing that investors in traditional markets seek to have greater exposure to crypto assets
The survey notes that being crowded has historically been associated with market tops. In other words, a “crowded trade” is one in which a great majority of traders make the same bet.
This is not the first time that Bitcoin has led the list of most crowded trades in a survey of Bank of America fund managers. It had already been at the top in January, just before the price of Bitcoin hit all-time highs.
Additionally, fund managers at Bank of America chose Long Bitcoin as the busiest trade in September 2017.
According to Fund Managers, Bitcoin is in a Bubble Zone
About 75% of the fund managers surveyed consider that Bitcoin is in a bubble zone. In the previous month, 74% of fund managers said that Bitcoin was a bubble, which represents only a slight increase.
Regarding whether Bitcoin is a bubble, 74% of the investors surveyed answered that it is. Only 16% of them said that it not is and 10% said they did not know or did not want to say anything about it.
The Bank of America has curiously warned that Bitcoin is in a bubble. Michael Hartnett, the chief investment strategist of the financial institution, said that Bitcoin was “the mother of all bubbles.”
In March, the strategist of the bank said that investors still bet on Bitcoin for “sheer price appreciation.”
Although there is an ongoing sideways trend in the cryptocurrency markets, Bitcoin (BTC) is still a crowded trade. This could suggest that the top of the market of the current bullish cycle is getting increasingly close.
The pioneering cryptocurrency has gone through situations where its price seemed as though it would not rebound again. However, it has proved that it is also capable of exceeding its latest all-time highs.
By Alexander Salazar
