Mike Novogratz, CEO of crypto investment company Galaxy Digital, is one of the cryptocurrency industry’s enthusiastic advocates, despite the sector’s development since its formation and many sceptics.
eMoney Financial stated on July 19 that Novogratz, speaking at the Bloomberg Crypto Summit, predicted that Bitcoin (BTC) would reach around $500,000 over the next five years owing to its unique characteristics and rapid adoption rate.
Among Bitcoin’s unique characteristics, he noted that it was “tailored to becoming an anti-inflation store of wealth” and “easily transferrable and hence superior to gold in so many respects.”
Moreover, the billionaire ex-fund manager said that the debt-driven global financial system was fueling excessive consumer price inflation and that Bitcoin may serve as a novel method of long-term asset storage.
Unanticipated degree of leverage
Bloomberg’s Misyrlena Egkolfopoulou and Sonali Basak wrote on July 19 that Novogratz described the current volatility in the crypto market as a “full-fledged credit crisis” and conceded he was “darn incorrect” about the amount of the system’s leverage.
“What I don’t believe anyone anticipated was the scale of losses that would appear on the balance books of professional institutions, which prompted the daisy chain of events. (…) It developed into a full-fledged credit crisis, resulting in total liquidation and severe damage to trust in the sector.”
Novogratz also criticised authorities for not safeguarding regular investors and allowing institutions to take on enormous leverage, claiming that his cardiologist lost $1 million in the Celsius crash.
However, he also noted that the “worst is over” for the cryptocurrency market and that the case for Bitcoin remains strong, particularly as central banks battle inflation.
Finbold reported that Novogratz predicted that for the cryptocurrency market to recover, the Federal Reserve would need to “lift its foot off the brake” and that the bulk of hedge funds investing in digital currencies would fail.
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