Mike Novogratz, CEO of digital asset manager Galaxy Digital, warned against trying to predict a bottom for the recent crypto crash.
Novogratz’s comments come in the wake of one of the worst recessions the crypto market has seen in recent times. Majors like Bitcoin and Etherum are trading close to 60% below their record highs, while most altcoins have collapsed as much as 80%.
Galaxy Digital was also a major in Terra, arguably the biggest casualty of the recent defeat. Novogratz, who has been an outspoken supporter of the project, has also publicly apologized to Terra, which wiped out an estimated $40 billion in investors.
Novogratz warns against bottom picking
React Speaking of the recent crash, Novogratz said trying to pick a bottom poses extremely high risk, stating the market could potentially crash further.
Alts are more than 80 percent lower than the highs. In (2018) this was more than 95 percent. That’s another 70 percent lower. My point is that choosing bottoms is dangerous and if you scale up slowly.
The factors that caused the latest crypto crash – high inflation and rising interest rates – are still largely at play. Markets are widely pricing in a Federal Reserve rate hike at its next meeting.
Recent data also showed that inflation in the US will take much longer than expected to cool, pointing to more economic pressures.
Where is the crypto floor?
With the latest crash erasing more than $500 billion in crypto market capitalization, investors are rushing to guess the turning point for markets.
Bitcoin, a crypto market clockmaker, was expected to hold $28,000 as hard support. But the token has repeatedly dropped below that level and is still floating slightly above the level.
Technical indicators for Bitcoin are also strict. The token recently saw a death cross – a drop in the short-term moving average below a longer-term moving average.
Historically, a death cross has always led to more losses for the token, and in turn the crypto market.
With over five years of experience in global financial markets, Ambar plans to leverage this knowledge for the fast-growing world of crypto and DeFi. His main interest lies in finding out how geopolitical developments could affect crypto markets and what that could mean for your bitcoin holdings. When he’s not scouring the internet for the latest news, you can play him video games or watch Seinfeld reruns. You can reach him at [email protected]
The content presented may contain the personal opinion of the author and is subject to market conditions. Do your market research before investing in cryptocurrencies. The author or the publication is not responsible for your personal financial loss.
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