For nearly a year, the global cryptocurrency market has been experiencing troubles. From the FTX debacle to the LUNA catastrophe, which in May 2022 destroyed billions of dollars in investor capital. The recent closures of three US-based crypto-friendly institutions, including Silvergate Capital Corp., Signature Bank, and Silicon Valley Bank of SVB Financial Group, have exacerbated the market collapse of last year.
Founder of Galaxy Digital Mike Novogratz highlighted the issues that are currently plaguing the cryptocurrency market and said that the US economy is experiencing a credit crunch and appears to be heading into a recession as a result of the recent events. He asserted that this is the right time to go long on Bitcoin and Gold.
“If there was ever a time to be in bitcoin and crypto, this is why it was created, in that governments print too much money whenever the pain gets too great, and we’re seeing that. In a short period of time information has changed dramatically. The commodity market is telling you, the oil market is telling you we’re heading into a recession,” he told CNBC Wednesday.
According to him, stocks will probably drop temporarily before rising as a result of the Fed’s changing stance. He said that the recent decline in the price of commodities, particularly oil, was a sign that the globe and the United States were entering a recession.
Jerome Powell, the head of the Federal Reserve, might or perhaps decrease interest rates shortly, according to Novogratz. As a result, there may be a substantial psychological change that favors Bitcoin and Ethereum.
Novogratz also expressed concerns about the banking system’s recent state in the US. He projected that unless the Fed adopted additional measures to safeguard deposits, individuals would learn from their mistakes and shift towards four or five major banking institutions.