The cryptocurrency market has hit the bottom, setting the stage for a bounce-back of units like the bitcoin, according to Michael Novogratz, founder of cryptocurrency asset management firm Galaxy Digital Capital Management.
Bitcoin witnessed a “classic speculative global mania” in 2016-2017 but is now on the upswing because the market has hit “seller fatigue,” Novogratz said at an event in New York on Thursday, Reuters reports.
Speaking at Yahoo Finance’s second annual All Markets Summit, Novogratz said Galaxy Digital’s cryptocurrency index showed a “classic bottom” in the market, with a selloff of more than 85 percent from its peak.
Bitcoin was last valued at US$6,420, less than a third of its peak near US$20,000 in December 2017.
Novogratz, a former hedge fund manager at Fortress Investment Group and Goldman Sachs Group partner, has been one of the most outspoken advocates of cryptocurrencies on Wall Street.
“Bitcoin has held $6,000. Yes, it is off its highs, but it has established itself as a store of value,” Novogratz said at the Thursday summit.
There is a lot of institutional money ready to spend on cryptocurrencies, particularly at venture funds, said Novogratz of a move that would boost prices.
Banks will experience “FOMO,” or a fear of missing out, on the crypto trend, Novogratz said. “I think institutions are moving towards investing.”
Asked about the meteoric rise of cannabis stocks, such as Tilray, Novogratz said the prices right now feel like where bitcoin was last year.
Galaxy Digital in May launched an index in cooperation with Bloomberg to track performance of 10 virtual coins.
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