Galaxy Digital CEO Mike Novogratz says the top two crypto assets by market cap could explode past previous all-time highs if institutions start allocating small amounts of capital to digital assets.
In a new interview with CNBC, the billionaire says that the US government’s growing inability to maintain a budget and avoid deficits is bullish for crypto.
[adinserter block="1"]Faced with the likelihood of higher inflation and lower interest rates, Novogratz says that if institutions decide to allocate even small amounts of their portfolio to crypto, Bitcoin (BTC) and Ethereum (ETH) would experience a supply crunch and go parabolic.
“I’ve been down to D.C. a lot in the last four months. If I had any faith that we would get a Simpson Bowles amendment to balance the budget or have any fiscal prudence, I wouldn’t be as bullish on Bitcoin. But I just don’t, and we’re going into an election year.
So you’ll have a Fed cutting with a 5% budget deficit and a projected 5% budget deficit next year and the following year. If people start shifting 1% of their portfolio, institutions, 1%, not 10, just 1, there isn’t a lot of supply in Bitcoin or Ethereum.”
Novogratz, an early Ethereum investor, says that Bitcoin is entering an unprecedented supply and demand dynamic that he believes could easily put BTC well above its previous all-time high.
“We have customers that are platform customers and buy enough Bitcoin every day to take out all the miners. So when you think about the supply/demand dynamic, we haven’t really had a situation where you have a global market and something of such limited supply. And so I think Bitcoin can go far higher. I think the first stop next year will be the old highs, $69,000, but it wouldn’t surprise me if it went beyond that.”
BTC is worth $42,411 at time of writing, while ETH is trading for $2,194.
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