Billionaire Mike Novogratz predicts an impending US credit crunch and says the outcome will boost crypto
Galaxy Digital founder and CEO Mike Novogratz predicts that a slowdown in the US economy will benefit the top two crypto assets.
In a new CNBC interview, Novogratz says the crypto rally has been driven by growing adoption and belief that monetary tightening is over or nearing its end.
According to Novogratz, Bitcoin (BTC) and Ethereum (ETH) will do well amid an upcoming US credit crunch triggered by Federal Reserve rate hikes.
“And so we have quite a contractionary rally based on a number of things. One of them is the market pretty sure [Federal Reserve] Chairman Powell is pretty much done, or almost done [raising interest rates].
We are heading into a credit crunch in the United States and gold, bitcoin and ethereum, these assets will do well in a downturn tell us something.
The second is adoption. There are 180 million people who own a piece of Bitcoin. This number grows every year. And we’re seeing aggressive moves in Hong Kong, Abu Dhabi, and Dubai because their regulatory frameworks are attracting crypto while the US is fighting it. And so we see a lot of Asian money coming in, we see some hedge funds in the United States participating in the futures market.”
Referring to Ethereum’s Shapella upgrade, which will allow ETH withdrawal for the first time since December 2020, Novogratz says it will be a “big win” for the second largest crypto asset by market cap.
“Ethereum has underperformed a bit this year. We don’t think there will be a lot of sales, that maybe people will sell their staking rewards…
It takes a few days to digest. But Ethereum has its own large and vibrant community that does a lot of good things and this is another big win, a feather in the cap of progress in the Ethereum community…
I don’t see a big Ethereum sell-off coming.”
I
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