According to Mike Novogratz, billionaire founder and CEO of Galaxy Digital, Bitcoin is unlikely to fall below $50,000 unless a major event occurs.
In an interview with CNBC yesterday, Novogratz said that the primary reason for Bitcoin's recent rise is sustained inflows into the spot Bitcoin ETFs recently approved in the US, and as long as net inflows remain positive, the BTC price will continue to rise.
“When this becomes negative, you'll see the first real correction,” Novogratz said.
“Business is very active, funding rates are high and so in times like these you always need to be ready for a correction. I don't think we will go below $50,000-55,000. “I think unless something dramatic happens, that's the new base.”
Novogratz noted that there was a sudden “mindset shift” in the market following the approval of spot Bitcoin ETFs. He said older generation investors got their first exposure to BTC by investing through registered investment advisors. Meanwhile, BTC holders are reluctant to sell and often think of their net worth in terms of how many BTC they own rather than how many dollars they have, according to Novogratz.
Novogratz also noted that Bitcoin is currently in price discovery mode and could potentially reach $100,000.
According to Novogratz, spot BTC ETFs accumulate significant amounts of bitcoin. When asked if these ETFs will eventually hold all BTC, Novogratz said he does not believe spot BTC ETFs will hold more than 20% of total BTC:
“They are loading right now. At some point it will reach an equilibrium. “And there are still a lot of people who want to keep their coins or keep them in a foreign place if they don't trust the country they are in.”
The price of Ethereum, the second-largest cryptocurrency by market cap, has also risen in recent weeks and is currently trading around $4,000. According to Novogratz, the US Securities and Exchange Commission (SEC) will eventually approve spot Ethereum ETFs. Novogratz said there are already Ethereum ETFs based on futures, so “it's necessary to have cash spot ETFs.”
*This is not investment advice.