Billionaire Mike Novogratz has warned investors not to expect a big recovery in bitcoin any time soon. Novogratz, who serves as CEO of digital asset merchant bank Galaxy Digital, has always been a big supporter of Bitcoin and its advantages. However, he recently shared his thoughts on the current market climate and what investors should expect in the coming days.

Trust will take a while

The recent market crash has seriously affected the faith of investors in the cryptocurrency market. As such, the sell-off of digital assets like bitcoin has been rampant. Sentiment has also suffered heavily during this time and has led to low momentum in the market. This is not going to change any time soon.

Related Reading | Bitcoin Recovers Before Hitting 2017 Peak, Has It Bottomed?

Speaking to Bloomberg, the Galaxy Digital CEO explained that it will take a while for Bitcoin to recover to previous levels. He attributes this to the level of investor confidence when it comes to investing money in cryptocurrencies, which he says will take time to regain that confidence.

Bears seize BTC | Source: BTCUSD on TradingView.com

Novogratz also talks about the current economic climate. One thing that has rattled various financial markets has been the Fed’s rate hike, the most recent hike occurring on Wednesday. He points out that the Fed would have to stop raising interest rates at some point, and once it does, more money will flow from global macro hedge funds into the market. At this point, Novogratz admits that Galaxy Digital will add more bitcoin to their holdings.

bitcoin on the charts

The bitcoin price continues to fluctuate heavily between the $20,000 and $21,000 levels. This shows that while there is growing resistance at the $22,000 point, there is also good support building in the low $20,000s.

However, the short-term forecast for the digital asset does not look good. However, there are still some indicators that point to some recovery in the market. One of them is the cycle low before each bitcoin halving.

Related Reading | Bitcoin Funding Rates Still Negative, But Open Interest Tells Another Story

The bottom is usually reached around 520 days, give or take a few weeks, before the next bitcoin halving. This has been the case for the last two halves. If the digital asset follows this trend, it will bottom out sometime in the last quarter of the year. Although this points to some recovery in the short term, it also means that the current lows may not be the end of the decline if it is expected to bottom out in the fourth quarter.

Bitcoin is trading at $20,902 at the time of writing.

Watcher Guru Featured Image, Chart from TradingView.com

Disclaimer: The following opinion piece represents the views of the author and may not necessarily reflect the views of Bitcoinist. Bitcoinist is an advocate for creative and financial freedom alike.

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