Bitcoin bull Mike Novogratz warns Jerome Powell's second Fed stint could bring pain for crypto prices
- Jerome Powell's second term as
Fedchair may bring some pain for cryptoassets, Mike Novogratzhas said.
- Novogratz said Powell may now feel freer to tackle
inflationby tightening monetary policy.
Billionaire investor Mike Novogratz has said Fed Chair
Novogratz told CNBC on Wednesday the "macro story has changed a little bit" and that "people are getting pretty bearish" on cryptocurrencies.
"Powell gets reappointed, and so maybe it allows him to act more like a central banker than a guy that wants to be reappointed," Novogratz said on CNBC's "Crypto Night In America."
"And we have inflation showing up, you know, in pretty bad ways in the US," he said. "And so we can see, is the Fed going to have to move a little faster?
"That would slow all assets down. It would slow the Nasdaq down. It would slow crypto down, if we have to start raising rates much faster than we thought."
President Joe Biden nominated Powell to serve for a second term as Fed chair earlier this week.
Powell has overseen the biggest monetary stimulus in US history to help the economy cope with the coronavirus crisis.
But the Fed is now grappling with the strongest inflation in 31 years. It has already trimmed the rate at which it is purchasing bonds, and minutes from its last monetary policy decision, released Wednesday, showed officials are open to dialling down quantitative easing even faster.
Novogratz has previously predicted bitcoin would hit $100,000 by the end of the year, but said that now looks unlikely. Bitcoin was up 3.83% on Thursday to $58,667 on the Bitstamp exchange.
However, the former hedge fund manager, who now runs crypto investment company Galaxy Digital, said there is still lots to be excited about in the world of digital assets.
"The amount of institutions Galaxy sees moving into this space is staggering. I was on the phone with one of the biggest sovereign wealth funds in the world today, and they've made the decision on a go-forward basis to start putting money into crypto. I've had the same conversations with big pension funds in the United States," he said.
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