Novogratz predicts Bitcoin drop, and delays crypto fund
Bitcoin’s inherent volatility was on full display this last week, with the currency continuing to drop in value on a daily basis. This downward spiral wasn’t just reserved for Bitcoin though. Th whole crypto industry seemed to follow suit.
From staggering high of $20k not too long ago, it’s future looked bright. However, that shine seemed to be short lived as the currency was trading at an average of just over $13k on major exchanges last week.
Billionaire Bitcoin advocate, Michael Novogratz, has made no secret of the fact that he believes in the power of the currency, previously announcing plans to launch a $500 million crypto investment fund.
The hedge fund guru is also known for his Bitcoin price predictions. In October this year, he forecasted that the currency would trade at $10k by April next year, which Bitcoin preempted by reaching five-figure status last month already. His next prediction is $50k by the end of next year.
Novogratz purchased Bitcoin when it was trading at just $50, and Ethereum when it was selling for $0.30 during its initial crowdsale. Through trading both currencies, and liquidating a portion of his stash this year, he has made approximately $250 million.
Even though he is a staunch supporter, Novogratz has added his voice to the bubble chant. However, he has previously said that even if the bubble bursts, crypto can still be capitalized on, which was one of the aims of his new fund. It was scheduled to be launched in mid-December, but plans have changed somewhat as the project has been put on hold. Novogratz had this to say:
“We didn’t like market conditions and we wanted to re-evaluate what we’re doing. I look pretty smart pressing the pause button right now.”
One of the reasons cited is conflict of interest. An example of this exact issue is if he bought Bitcoin for the fund, but sold it from his personal account. He explained:
“There are just so many conflicts in that business. It was going to be more complicated than I wanted.”
The investor’s latest predictions differ greatly from his initial forecasts. Novogratz now believes that Bitcoin’s downward spiral will reach as far as $8k, before eventually stabilizing between $10k and $16k.
Even though many investing and crypto novices have recently hopped on the digital currency rollercoaster, its important to invest smartly and not put all of your eggs in the ever-volatile Bitcoin basket.
Author : Jack Dean