The bitcoin price is taking a bit of a breather, having retreated slightly below the USD 50K level once again. According to one market expert, however, even if there is a pullback, you might not want to bet against the markets just yet. That goes not just for crypto but stocks too.
Mike Novogratz, who is at the helm of Galaxy Digital, in an interview with CNBC described how the bitcoin market has momentum on its side. In the short term, don’t be surprised to see prices stabilize and consolidate, he noted, adding that prices “don’t keep going up forever.” Though they are on pace to go up for the year.
For the latest quarter, the cryptocurrency market, as well as the S&P 500, have been on fire. According to Novogratz, winners of the year with such a jump start will usually just “drive on.”
In fact, he does not see a reason not to be long stocks here. Valuations might be lofty, but given the pace of share buybacks and the Fed’s money train, investors can expect stocks to be resilient.
It wasn’t too long ago that the bitcoin price was trading in the doldrums and hovering at about the USD 30K level. Ethereum, the second-biggest cryptocurrency, was trending lower too. A paradigm shift happened, however, that has put the fuel back into crypto prices.
Major companies including the likes of Amazon and Walmart are on the hunt for blockchain talent. Visa just doled out USD 150K in Ethereum for its very first non-fungible token (NFT) — a Crypto Punk digital avatar. From the sounds of it, this NFT might not be Visa’s last.
In addition, the cryptocurrency industry gave lawmakers a wake-up call in Washington, D.C. with such an organized response in reaction to a shortsighted infrastructure bill that takes aim at crypto. Novogratz said,
“We became an industry in D.C.’s eyes,” calling it a “huge shift.”
"When Jay-Z put his crypto punk as his Twitter avatar–one of the kings of culture says I'm going to use a #NFT as my avatar. It should have told everybody to buy #cryptopunks," says @novogratz. "This is a shift culture and I think it is a big, big deal." pic.twitter.com/oK8w0frQ0n
— Squawk Box (@SquawkCNBC) August 25, 2021
Novogratz on NFTs
Novogratz is quick to point out that there is froth in the NFT market as prices continue to go up into the stratosphere. EtherRocks, a project comprising a collection of jpeg clip art, are the latest example of this. Tron founder Justin Sun, for example, forked about USD 600K for an EtherRock NFT. Another EtherRock went for more than USD 1 million this week.
Just spent half million dollars on a rock 😂 pic.twitter.com/4zDmDgzERz
— Justin Sun 🅣🌞 (@justinsuntron) August 22, 2021
NFTs are capturing more and more of the total art industry sales, which for such a nascent market is making a statement. According to Novogratz, that statement is that NFTs represent a shift in culture, which according to him is a big, big deal.