No Bitcoin Fan, Dennis Gartman Gets Rekt Investing in Blockchain Play
Dennis Gartman, an investment expert and publisher of The Gartman Letter, revealed that his investment in a blockchain firm — Riot Blockchain Inc. — is stinging him badly as the company’s shares have plummeted following a CNBC investigative report. Gartman risked his retirement money on the revamped blockchain company even though he thinks bitcoin is “nonsense.”
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Avoided Bitcoin, Burned by Blockchain
Cryptocurrency industry leaders like Xapo CEO Wences Casares and Ethereum co-founder Vitalik Buterin have lately warned crypto investors not to invest more than they can afford to lose.
Last December in an interview with CNBC, Dennis Gartman labeled bitcoin as “nonsense” and pointed out he will not deal in bitcoins. But as an advocate of institutional investments, Gartman did invest in recently turned blockchain biotech company, Riot Blockchain Inc.
Riot Blockchain — formerly known as Bioptix — is a company that recently rebranded itself as a blockchain firm to capitalize on the ongoing boom. The company’s stock spiked from $8 USD to $40 amid the buzz.
But Gartman’s investment was about to be rekt.
Riot’s stock acutely fell by almost 30 percent after CNBC’s investigative digging raised questions about the company’s business model. Last month, Securities and Exchange Commission (SEC) Chairman Jay Clayton reprimanded companies that add “Blockchain” to their name to cash in on crypto mania. Clayton noted the SEC is “looking closely” at companies that have rebranded their businesses this way.
As Clayton clarified:
“Nobody should think it is OK to change your name to something that involves blockchain when you have no real underlying blockchain business plan and try to sell securities based on the hype around blockchain.”
Gartman FOMO’d, Got Burned
It seems Gartman experienced FOMO (“Fear on missing out”) and jumped into Riot Blockchain without doing his homework. He, like many cryptocurrency traders, was seemingly just trying to catch the hot next thing for a fat profit.
The longtime publisher recently in his eponymous newsletter:
“Friday was one of the worst days we have suffered through in a very long while. We were long of a sizeable position in a blockchain focused company that was the victim of a CNBC expose, which sent the shares down more than 20 percent and which sent us ‘down’ for the year to date, having been up about 6 percent previously.”
It looks like Gartman is wishing he’d been a bit more conservative. “Lessons have to be learned again and again and again it seems,” the investor concluded.
Should Gartman have picked bitcoin over a newly-turned blockchain company? Let us know your opinion in the comments section.
Images via CNBC, USMarketsDaily