Given the huge run-up in cryptocurrencies this year, billionaire investor Mike Novogratz is predicting Bitcoin will soon consolidate to a narrower trading range, but noted that pure excitement could carry prices even higher.
“On a go-forward basis, Bitcoin probably consolidates somewhere between $7,000 and $10,000. You know, trees don’t grow to the sky,” the chief executive officer of Galaxy Digital Holdings Ltd., said on a conference call Thursday discussing the company’s first-quarter financial results. “If I’m wrong on that, I think I’m wrong to the upside, that there’s enough excitement and momentum that it could carry through.”
Bitcoin briefly topped $9,000 on Thursday for the first time in a year.
Novogratz credits this year’s rally to wider mainstream acceptance and greater embrace of cryptocurrencies and their underlying blockchain technology by established Wall Street and technology firms. Facebook Inc. is reportedly working on creating its own cryptocurrency that will let users transfer money on one of its messaging apps, and Microsoft Corp. has launched a digital identity program built on blockchain technology. Novogratz named those two projects as evidence of the trend, saying that “both were wild credentializers for this space.”
“We have gone from, you know, crypto as an experiment, is it real? Is it tulips? To crypto is going to be a substantial part of the financial and consumer infrastructure of the world,” the former Fortress Group hedge-fund manager and Goldman Sachs Group Inc. partner said on the call.
For the three months ended March 31, net income was $12.9 million, compared with a net loss of $134 million in the year-earlier period. The income was largely a result of realized gains on digital assets and unrealized gains on investments, Galaxy Digital said in a statement.
Novogratz was similarly resolute during last year’s “crypto winter,” even as his firm lost millions amid a wider market tumble, saying then that he had high hopes crypto adoption would become more universal. That forecast proved to be prescient -- Bitcoin is up more than 130% since New Year’s Day to about $8,700. Other coins, including Ether, have also gained significantly but still have a lot of catching up to do, he said, adding that Ethereum’s got a long way to go in getting its technology right.
But there’s “lots of excitement in the space” he said on the 10-minute call, joking that he spent more time being stuck on an elevator early Thursday morning than he spent discussing the results. “We really do feel significantly better about the business.”
© Copyright 2023 Bloomberg News. All rights reserved.