El-Erian says he bought bitcoin but sold it too soon — here‘s when he‘d be willing to buy it again

<p>Mohamed El-Erian, a well-known economist, claims to have purchased bitcoin a few years ago but misjudged when to sell due to "behavioural mistakes."</p> <p>The Allianz chief economist revealed that he bought an unspecified amount of bitcoin during the "crypto winter" of 2018, when the world's largest digital coin fell close to $3,000 after a monster rally that took it above $19,000 a year earlier.</p> <p>"I felt compelled to buy it — I really did," El-Erian told CNBC's Dan Murphy on Monday. "I felt as if I'd framed it." I had this level, and I had a starting point."</p> <p>He then held his position until late 2020, when bitcoin regained the $19,000 mark. A few months later, bitcoin continued its wild ride, reaching a record high of more than $60,000.</p> <p>Bitcoin is now trading well above $60,000, with a new all-time high of over $68,000 set last week. According to Coin Metrics data, it was last trading at around $65,810, up nearly 3% in the last 24 hours.</p> <p>Analysts attribute the rally to inflation fears and the launch of the first bitcoin-related exchange-traded fund in the United States. Meanwhile, bitcoin's underlying blockchain was upgraded significantly over the weekend.</p> <p>Nonetheless, bitcoin and its smaller competitors, such as ethereum and XRP, are notoriously volatile assets. Bitcoin's price nearly halved after initially exceeding $60,000, as Chinese regulators tightened their grip on cryptocurrency mining and trading.</p> <p>"You don't want to ask me about valuations because I'm not sure why $60,000, rather than $68,000, is the right level," El-Erian added.</p> <p>When should I repurchase?</p> <p>El-Erian divides bitcoin investors into three groups: long-term "fundamentalists," professional investors looking to diversify their portfolios, and day-trading "speculators."</p> <p>The economist stated that he would only feel comfortable buying again after some of the market's speculators have been "shaken out." According to him, the first two types of investors are "really strong fo