Billionaire trader and legendary hedge fund manager Mike Novogratz says that the bitcoin price will reach $10,000 before the end of the year.
Novogratz, a former Fortress manager, made this bullish prediction in an interview with Bloomberg on Tuesday. He explained that bitcoin has value for the same reasons that gold does: scarcity, distrust of the central banking system, and consensus.
Previously, Novogratz has stated that he believes mainstream financial firms are preparing to make a splash in the bitcoin markets and ecosystem. In October, he said that this Wall Street “herd” will carry the bitcoin price to $10,000 within six to 10 months. However, the bitcoin price has already increased approximately $3,000 since then, making him confident that bitcoin will reach the five-figure mark by the end of 2017.
“The institutionalization of this space is coming. It’s coming pretty quick.,” he said recently.
Standpoint Research founder Ronnie Moas has made a similar revision to his market forecast in response to increased Wall Street interest in bitcoin, raising his 2018 bitcoin price target to $14,000 from $11,000.
Responding to the recent market volatility associated with the $31 million hack of Tether, a USD-pegged Omni token that serves as a substitute for cash on many cryptocurrency exchanges, Novogratz explained that traders are nervous about losing the massive profits they have accumulated during bitcoin’s yearlong bull run. Consequently, they react skittishly at every potential market hiccup, even though the bull run has a long way to — $5 trillion according to an estimate he made earlier this year — before it reaches true bubble status.
“We’re in the second or third inning of this revolution,” he said. “Because prices have moved so far people are nervous. You made a whole lot of money, there’s news, so you want to book your profit and get out.”
Novogratz also told Bloomberg that investors have been “receptive” to his creation of Galaxy Investment Partners, a $500 million crypto-hedge fund — the largest of its kind — that will invest exclusively within the blockchain space. He is staking at least $100 million of his own capital in the fund, and he hopes to raise $350 million to $400 million from external investors by the first quarter of 2018.
Featured image from YouTube/WallStreetWeek.