Bitcoin recovers slightly to hit $38,000, but this expert says stay away

• Bitcoin has regained some of the value lost over the past few days and at press time it trades at $38,100, gaining 3 percent overnight.
• One Canadian investment manager says that investors should avoid Bitcoin as its volatile, unpredictable and unregulated market could wipe out entire portfolios.

It’s been a bearish week for cryptocurrencies, with Bitcoin having shed 15 percent of its value in the seven days prior to today. However, in the past day, the market has recovered slightly and BTC is once again trading above $38,000. However, according to one veteran Canadian investment manager, investors should stay away from the cryptocurrency as they risk having their entire portfolio wiped out.

At press time, BTC is changing hands at $38,100, up by $1,380 or 3.75 percent in the past day, with trading volume dipping by 28 percent to $23.1 billion.

Despite the market looking to end the week on a high, one veteran investment manager has cautioned against investing in BTC. John Hood, the president and portfolio manager at JC Hood Investment Counsel says that the uncertainty alone with BTC is enough to make investors stay away.

In an interview with Bloomberg BNN, he said:

I don’t recommend Bitcoin because to me you don’t know what’s on the other side, who’s on the other side of the transaction.

“Bitcoin futures ETFs are nonsensical”

Hood further cited the recent struggles by BTC companies that have applied for BTC spot futures with the Securities and Exchange Commission to no avail. He says that this is a testament to the negative view that regulators have on Bitcoin.

There are a lot of things about it that are uncertain and that I don’t like and the very fact that the US Securities and Exchange Commission has rejected that coin for those very reasons [concerning]lack of transparency, that’s an issue for me. So, I really don’t want those things in my portfolio.

While it’s true that the SEC has rejected spot ETFs, it has not demonized the Bitcoin market in its entirety. The watchdog has pointed out that it’s concerned about possible market manipulation and a lack of investor protection measures, which is expected in a nascent market.

Related: 95% of U.S investors support the Grayscale Bitcoin spot ETF application as SEC delays decision

The SEC has also approved applications for a futures BTC ETF, with the ProShares Bitcoin Strategy ETF (trading under the ticker BITO) being the first to debut in the US market and being an instant hit. Many market participants, within crypto and beyond, looked at this as a positive development.

However, Hood says this is nonsensical. Exposing the average BTC investor to a futures product puts him at risk of losing his money as these products can be very complex, he told Bloomberg BNN.

It’s different in Canada, with regulators approving spot ETFs in the Great White North.

“The one advantage we have in Canada with Evolve and Purpose is these are on spot prices, current prices, whereas in the US they have this curious argument that they can’t regulate [cryptocurrency]on a spot basis but they regulate it on a futures market,” Hood noted.

He added:

So, you can buy Bitcoin on the futures market, which makes absolutely no sense because most investors buying Bitcoin have no idea of how the futures market works.