Mike Novogratz Updates His Forecast: Bitcoin Will Drop Further

Mike Novogratz, the CEO of Galaxy Digital, predicts further downside for the leading digital asset, Bitcoin.

According to Bloomberg report, Novogratz shared with CNBC in a new interview that he believes Bitcoin to reach bottom at around the $38,000 to $40,000.

Novogratz last week said that BTC could defend the $42,000 mark, but after the latest drop below that level, he has updated his prediction.

The Galaxy Digital CEO says that that at the moment he is not buying more cryptocurrencies, pointing out that blue-chip investors are waiting for their opportunity to get in.

“Tremendous amount of institutional demand [is waiting] on the sidelines.”

Novogratz himself hasn’t lost interest in the crypto market. In fact, he got a tattoo inspired by the coin Terra (LUNA) just a few days ago, following a Bitcoin themed tattoo in December 2020.

According to Novogratz an important part of BTC’s bull run in 2021 was the devaluation of fiat currencies globally.

He explained that the U.S. Federal Reserve’s recent announcement that it would be tapering its purchasing of bonds while raising interest rates, is a contributing factor to Bitcoin’s crash.

Also, Bitcoin is still correlated to the Nasdaq which has come off from the highest levels, Novogratz said.

Minutes from the Fed’s December meeting showed officials’ increasing preference for a faster path of rate hikes and a shrinking of the bank’s $8.8 trillion balance sheet. Speculation about tighter monetary policy has taken the shine off risk assets like crypto and richly valued technology stocks in recent days, dragging down the Nasdaq 100 index.

BTC is currently trading at $42,943, with 8.4% loss on a weekly chart.