Morgan Creek Capital Management founder and CEO Mark Yusko thinks that crypto already saw the worst of the bear market when Bitcoin (BTC) slid close to the $17,000 level this month.
In a new interview on the YouTube channel Thinking Crypto, Yusko says that the price of digital assets may still go lower amid a selloff following the much-hyped merge to proof-of-stake for Ethereum (ETH).
The hedge fund veteran says that crypto markets have bottomed out and are now on track for the next bull cycle.
“I actually do believe crypto winter is over. I believe we’re in crypto spring. I believe we have seen the bottom.
That doesn’t mean we can’t retest it. It doesn’t even mean we couldn’t go a little bit lower than that, but I really do think that the cathartic unwind of the leverage in Bitcoin happened and I do think we’re having a little follow through here with a ‘buy the rumor, sell the news’ about the merge.
I think there were a lot of people that thought, when the merge happened, suddenly everybody was just going to buy Ethereum.”
Yusko says that even if the Federal Reserve decides to keep increasing interest rates, it will have a limited impact on global prices as the downturn batters nations worldwide.
“My personal belief is we’re in recession. It’s a shallow kind of 2001-style recession, not a depression. I think the Fed could overtighten and break things, but here’s the thing, how many Fed hikes are going to change the price of wheat coming out of Ukraine? It doesn’t matter, right? It has nothing to do with it.
How many rate hikes are gonna change the price of natural gas from Russia to Europe? Doesn’t matter, you could hike 50 times, it’s not going to change the price of gas. They’re not going to lower the price of gas because they got you over the barrel.
How many rate hikes is going to change the Zero-COVID policy in China and fix the supply chain so I could actually trade in my car and get a new Kia?
Yusko says that should the Fed pivot from its current stance on interest rates, the move could be bullish for crypto.
“I think we’re in a recession. I think because of that, the Fed will reverse. When they reverse, we’re going to have a face melter of a rally. I mean a face melter because the shorts are going to get scorched and the amount of shorts in crypto is massive.”