Michael Burry Warns of Catastrophe Worse Than Dot-Com Bubble, Says Crypto Collapse Is Top Risk

▲ Bitcoin (BTC), Ethereum (ETH), and Cryptocurrency Decline / ChatGPT-Generated Image

A legendary investor who accurately predicted the 2008 financial crisis has warned that “the largest market bubble in human history is about to burst.”

According to financial media reports on Feb. 12 (local time), Michael Burry, founder of Scion Asset Management and the real-life investor portrayed in the film The Big Short, assessed that asset markets have reached an unsustainable level of overheating. Through social media and investment reports, Burry emphasized that “the greatest bubble in history has formed across all sectors, and the end will be extremely miserable.” He voiced particular concern that technology stocks and speculative assets are continuing irrational rallies completely detached from the real economy.

Burry, who made substantial profits by foreseeing the 2008 subprime mortgage crisis, believes the current situation is far more dangerous than it was during the global financial crisis. He argued that investors are ignoring risks at the peak of the bubble and predicted that a chain reaction collapse will be inevitable once interest rate hikes and liquidity tightening fully take effect. He also criticized the cryptocurrency market as “the mother of all bubbles,” warning that virtual assets such as Bitcoin (BTC) would be among the first to crumble in the face of regulation and a liquidity crisis.

Burry’s analysis has sent shockwaves through investors, especially amid the stock market’s recent record-breaking rally. He criticized investors for being swept up in mass euphoria and heading toward the edge of a cliff, advising that now is not the time to chase returns but to exit the market to protect assets. It is known that Burry has already liquidated a significant portion of his positions or established short positions betting on a decline in preparation for a market collapse.

Global financial markets are closely watching when the catastrophe Burry has pointed out might begin, reviewing asset defense strategies amid heightened tension. Although he did not specify the exact timing of the bubble’s burst, he repeatedly stressed that indicators have already reached critical levels.

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