Mike Novogratz is unperturbed by Bitcoin crash but he also said that the cryptocurrency faces near-term uncertainty after falling below 30,000 USD this week.
However, at the time of writing this piece Bitcoin has found support with BTC valued at 33,300 USD.
Bitcoin has been retracing from the past few months from its all-time high in April near $65,000.
“Bitcoin has been retracing from the past few months from its all-time high in April near $65,000”
MIKE NOVOGRATZ
The weakness in recent days comes as reports indicated China took further steps to limit cryptocurrency services, as the national bank attempt to strengthen support for Chinese digital yuan. China is also attempting to shutdown mining services, arguing that electricity consumption is taking energy from productive economy. Miners are setting up elsewhere.
But For the Bitcoin community, this is recycled news, and recent fall, which is not unusual for BTC could be down to profit-taking.
Mike Novogratz is unperturbed by Bitcoin crash but he noted China has become more forceful in its cryptocurrency ban
Perhaps this is a wake-up call for investors that while China is an attractive place for capital it’s one country two systems also poses political risk for free-flowing capital. Capital returns are greater in China, but they need to be to compensate for the risk of capital controls.
“We had China be much more forceful in their idea to ban cryptocurrency. That’s created a retail deleveraging” Novogratz said on “Squawk Box.” “A lot of cryptos happens in Asia, a lot of it is Chinese focused. So, we’re seeing big liquidations, so it’s hard to call a bottom” said Mike Novogratz.
“We had China be much more forceful in their idea to ban cryptocurrency. That’s created a retail deleveraging”
MIKE NOVOGRATZ
“We’ll see if it holds on the day. We might plunge below it for a while and close above it” Novogratz said, referring to the $30,000 price level, which some technical analysts saw as a key support level for bitcoin. BTC reached a death cross this week, which means its 50-day moving average dropped below the 200-day moving average. A death cross can signal that buying momentum is coming out of the cryptocurrency.
“I think a lot of clients that didn’t buy it the first time will see this as an opportunity to buy it and get involved” – Mike Novogratz
“If it’s breached, $25,000 is the next big level of support. Listen, I’m less happy than I was at $60,000, but I’m not nervous” said Mike Novogratz, founder, and CEO of Galaxy Digital, a crypto-focused financial services firm.
BTC has had bigger drops before, for example, it reached $20,000 in December 2017 and then lost more than 80% of its value, sinking below $3,500 per token.
Mike Novogratz is unperturbed by the Bitcoin crash saying that he doesn’t expect another 80% crash in BTC
“The ecosystem is so much more mature. The number of players that are moving in is so much more mature. “I think a lot of clients that didn’t buy it the first time will see this as an opportunity to buy it and get involved”.
Indeed, Ethereum, the secure blockchain network used by developers to build applications also got hit in the crypto crash but what will be interesting to see if there is decoupling from bitcoin and blockchain in what now looks like the coming recovery in cryptocurrencies.
As the cryptocurrency space matures investors are beginning to realize that not all cryptocurrencies are the same.
