Bitcoin Likely to Stay Above $50,000, Says Billionaire Mike Novogratz
Bitcoin is currently trading at around $73,000 and is unlikely to fall below $50,000 unless a significant event occurs, according to billionaire Mike Novogratz, founder and CEO of Galaxy Digital. The continuous inflows into recently approved spot bitcoin exchange-traded funds in the U.S. have been driving the rally. As long as net inflows remain positive, the bitcoin price will continue to rise.
Novogratz believes that a correction may occur once net inflows turn negative. He acknowledges that the market is currently frothy and funding rates are high, indicating the need to be prepared for a correction. However, he does not expect bitcoin to drop below $50,000-$55,000 unless something dramatic happens.
Novogratz highlights a “mindset shift” in the market following the approval of spot bitcoin ETFs. Baby Boomers are now investing in bitcoin through registered investment advisors for the first time. Additionally, bitcoin holders tend to hold onto their coins rather than sell them, often valuing their net worth in terms of bitcoins rather than dollars.
In Novogratz’s view, bitcoin is currently in price discovery mode and could potentially reach $100,000.
Spot Bitcoin ETFs and Bitcoin Holdings
The approval of spot bitcoin ETFs has led to a significant accumulation of bitcoins by these funds. However, Novogratz doesn’t believe that spot bitcoin ETFs will ever amass more than 20% of the total BTC. He suggests that an equilibrium will be reached at some point as there are still many individuals who prefer to custody their own coins or store them in foreign locations if they distrust their home countries.
Spot Ethereum ETFs and the Price of Ether
The price of ether has also experienced a rally in recent weeks, currently trading at around $4,000. This surge is mainly due to the anticipation of spot Ethereum ETFs getting approved in the U.S. Novogratz believes that the Securities and Exchange Commission will eventually approve these ETFs. While there are already futures-based Ethereum ETFs available, the approval of cash-based spot ETFs is necessary.
Hot Take: Bitcoin’s Future and Potential for Growth
According to Mike Novogratz, bitcoin’s future looks promising, with a floor price likely to be established between $50,000 and $55,000. The continuous inflows into spot bitcoin ETFs and the increasing interest from Baby Boomers indicate a positive trend for bitcoin’s price. However, Novogratz advises caution as the market is currently frothy and funding rates are high.
Novogratz believes that bitcoin’s price discovery mode could potentially lead to a price of $100,000. As long as net inflows into spot bitcoin ETFs remain positive, the upward trajectory is expected to continue. However, investors should always be prepared for corrections in the market.
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