While prices have bounced back, numerous crypto enthusiasts are still feeling the sting from March when the cryptocurrency market took a nosedive, shedding about half its value in just a day's time.
Nevertheless, some investors remain undeterred, with Mike Novogratz—at the helm of Galaxy Digital and once a leader at Goldman Sachs—remaining a stalwart Bitcoin supporter, as he confidently countered bearish arguments in a recent Bloomberg chat.
“This Is the Time for Bitcoin”
Even amid volatile market conditions worldwide, Novogratz asserted told Bloomberg TV on Monday That the timing is perfect to increase Bitcoin holdings, even though the digital asset has faced a 35% decline after reaching its peak in February. He articulated his reasoning:
I’m invested in gold and Bitcoin—seeing unprecedented levels of debt monetization which, to my mind, solidifies the appeal of these hard assets over time.
Conversely, Novogratz has a pessimistic view of equities and the credit market, suggesting the existing surge in the S&P 500 is based on hollow optimism rather than the grim economic scenarios unfolding.
Why is Novogratz placing his bets on Bitcoin lies in his observation of the 'debt monetization' occurring.
Nations and central banking institutions globally have been upping their economic measures to tackle the financial and fiscal challenges posed by the pandemic and the ensuing economic downturn.
Highlighting significant steps like the U.S. administration distributing $1,200 to many citizens, the Federal Reserve reducing interest rates to zero percent, and committing to extensive bond purchases valued in trillions. Canada has rolled out a $40,000 interest-free loan scheme for small enterprises (with $10,000 as forgivable), and Spain mulls over Universal Basic Income, among other measures.
As Galaxy Digital CEO emphasized, such strategies enhance “hard assets look better.”
Adding weight to Novogratz’s viewpoint, the forthcoming Bitcoin block reward halving, set for the next 30 days, will cut the currency’s inflation rate from approximately 3.8% to 1.9%. The timing of this event alongside central banks' monetary base expansion couldn't be more ideal, as noted by Novogratz and other commentators.
Institutional Adoption is Happening
Novogratz further highlighted the crypto’s potential for growth, given its growing traction with institutional entities, particularly pointing to affluent individuals and hedge funds making their way into the Bitcoin space .
He wasn't exaggerating. Recently, Fidelity Digital Assets— the crypto-focused branch of the prominent asset management firm Fidelity Investments, controlling over trillions of dollars— informed The Block about an upsurge in interest from institutional sectors. A Fidelity representative communicated to The Block:
From a trading standpoint, we're continuously onboarding fresh clients each month, observing significant engagement growth. […] Lately, we've experienced increased momentum across operations.
Journalist sources verified this, indicating Fidelity’s cryptocurrency segment encounters rising inquiries from pension sectors, family offices, and overarching macro hedge funds, corroborating Novogratz’s observations.
While he didn’t reiterate his forecast in this Bloomberg discussion, the previous week, Novogratz mentioned on CNBC that he firmly Bitcoin anticipates Bitcoin surpassing $12,000 by October and shattering its previous peak of $20,000 before the year's conclusion.
As reported by Blockonomi previously, The former Goldman executive has such faith in these forecasts that he humorously stated:
“I’m declaring this as Bitcoin’s year, and should it falter by year’s end, I might consider retiring my boots.”
