As Bitcoin bounces, investors debate cryptocurrencies

Bitcoin, which hit an all-time high of $68,990 in November, is down 9% YTD

Bitcoin is bouncing around this year, with prices hovering above$41,000 after briefly dropping to their lowest level since September 2021. 

The dip comes amid investors' concerns about rising bond yields and worries about the Federal Reserve potentially accelerating the timing on its interest rate hikes in 2022. Additionally, a Bitcoin mining outage caused by a shutdown of the internet in Kazakhstan over the weekend has also impacted crypto prices. 

CRYPTOCURRENCY PRICES DROP OVERNIGHT SETTLING AT $41,900

Despite Bitcoin's slump, legendary investor and Miller Value Partners founder and chief investment officer Bill Miller told Wealthtrack on Friday that he has allocated 50% of his net worth in the world's largest cryptocurrency and related investments, including Stronghold Digital Mining and Michael Saylor's MicroStrategy. He believes individual investors should think of Bitcoin as an insurance policy and referred to it as "digital gold."

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"I think the average investor should ask himself or herself, "What do you have in your portfolio that has that kind of track record — No.1 is very, very under-penetrated, can provide a service of insurance against financial catastrophe that no one else can provide, and can go up ten times or fifty times," Miller explained. "The answer is: nothing."

Miller bought his first Bitcoin back in 2014 when it was trading around $200 per coin and purchased a "little bit more overtime" when it became $500. He then paused on buying more until it started plummeting from around $66,000 last year to the $30,000 range. He emphasized that his bullishness is due to "a lot more people using it now" and "a lot more money coming in from the venture capital world." As for the remainder of his net worth, nearly all the rest is in Amazon. 

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AMZN AMAZON.COM INC. 3,242.76 +18.48 +0.57%

Galaxy Digital CEO Mike Novogratz tweeted Monday that Bitcoin should hold at its current levels but warned crypto investors to keep a close eye on the markets. 

"Crypto at levels that ‘should’ hold but if Nasdaq rolls we will see more selling," he said. "Both equity and rate shorts warranted. We are in the ‘adult swim only’ zone."

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I:COMP NASDAQ COMPOSITE INDEX 14893.75271 +86.94 +0.59%

Meanwhile, Euro Pacific Capital chief global strategist and CEO Peter Schiff argues that a "terminal collapse" for Bitcoin is inevitable due to the fact that it has "no underlying value to support its price." 

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Bitcoin foundation chairman Brock Pierce tells FOX Business he does not expect the weakness in the market to continue much more, emphasizing that investors are "at a point of extreme fear."

"Historically, the markets have bounced when the sentiment was this low," Pierce added.

Bitcoin, which hit an all-time high of $69,990 in November, is down approximately 9% year-to-date. Meanwhile, rivals Ethereum and Dogecoin are also experiencing volatility.