The financial world, as we know, has come to a standstill, with stocks and bonds falling in record numbers. This market movement has also resulted in investors losing money, putting a damper on a number of new projects.
The cryptocurrency world was also hit by the price crash with Bitcoin falling by more than 34 percent. This phenomenon was one of the main topics of discussion during a recent talk between Anthony Pompliano and Michael Novogratz.
Michael Novogratz, the Chief Executive Officer [CEO] of Galaxy Digital stated that investors need to brace for impact in the near future. According to him, every once in awhile the financial world goes through a storm and the current situation was one of them. He claimed that at present, trade was becoming a global risk-off.
With the advent of the Coronavirus, multiple markets have crumbled to leave the financial world in total chaos. Novogratz called it a “rolling blackout” and added that Bitcoin had failed to function as a safe haven asset. In his words:
“I was always a big Bitcoin advocate and believed that it would solve the problems that fiat would find difficult. But right now, the Bitcoin market has also crashed which means that it is a leverage risk asset. The cryptocurrency was supposed to do well but it has done quite the opposite.”
The Galaxy Digital CEO predicted that it would be another 12 to 18 months before the cryptocurrency market would take flight again. He urged members of the community to stick together and push through the bearish atmosphere. This would require a boost in both confidence and morale. During his conversation with Pomp, Novogratz did not fail to praise the US Federal Reserve for its efforts in maintaining the economy.
Michael Novogratz said that the liquidity boost by the Fed was a great move to provide wriggle room for struggling banks and corporations. The Federal Reserve was also responsible for the recent rate cuts that brought it down to 0.00- 0.25. The move did not do much to arrest the slide as markets were down again the next day. Novogratz’s comments on Bitcoin came after the cryptocurrency crashed rapidly over the past week.
Bitcoin at press time was trading for $5265 after a 10.7 percent raise over the previous day. The total market cap was just 3.775 billion away from hitting $100 billion while the $24-hour market volume was $41.913 billion. The drop has been so drastic that Bitcoin has seen almost $5000 being shaved off its value. On February 15 Bitcoin was trading for $10,304 whereas on March 15, the cryptocurrency was worth $5375.