Charles Bobrinskoy of Ariel Investments has warned that Bitcoin is a momentum-driven bubble, predicting an imminent price decline as regulatory and market sentiment shift.

Bobrinskoy issued this stark warning about Bitcoin (BTC), labeling the cryptocurrency a “get-rich-quick scheme” driven by momentum rather than intrinsic value. 

Speaking on CNBC’s The Exchange, Bobrinskoy expressed concerns about Bitcoin’s reliance on minimal regulatory oversight, which he argued leaves it vulnerable to collapse when investor sentiment turns.

Bitcoin’s appeal lies in its lack of regulation, enabling large, anonymous transactions, Bobrinskoy noted.

He also highlighted its association with criminal activities and its detachment from traditional Know Your Customer rules as risks to the broader financial system. He dismissed Bitcoin’s initial narrative as a transactional tool, adding that its current positioning as a store of value lacks long-term sustainability.

Bitcoin’s price surge is purely speculative

Bobrinskoy, who manages Ariel’s focused value investment strategy and has decades of experience in investment banking, attributed Bitcoin’s recent price surges to speculative enthusiasm rather than underlying economic fundamentals.

He predicted a sharp decline in Bitcoin’s value once its momentum fades, echoing concerns about the cryptocurrency undermining the U.S. dollar and exposing investors to significant risks.

“So the point of this is that it has gone up because it’s gone up, and it will go down dramatically if it starts to lose that momentum — and that will happen,” he said. 

Ariel Investments, known for its disciplined value approach, has long focused on traditional equities. Bobrinskoy’s remarks reflect ongoing skepticism in traditional finance circles regarding the sustainability of cryptocurrencies without stronger regulatory frameworks.