Perennial bitcoin bull Mike Novogratz, founder and CEO of Galaxy Digital, claims bitcoin is positioned for major growth now that institutions are investing in it and big compananies are starting to accept it. Novogratz told CNNMoney’s “Markets Now” that big companies like Microsoft and Starbucks are allowing customers to use bitcoin and that, in the short term, more institutions will invest for fear of missing out (FOMO).
Novogratz, a former principal at Fortress Investment Group, last week said bitcoin would post a 30 percent increase by the end of the year once its surpasses major resistance levels at $6,800, $8,800, and $10,000, at which point institutions will enter the market through trusted custodian solutions. The price stood at $6,581 at the time of this report, according to CCN.
Institutions Step Forward
Citigroup and Morgan Stanley announced plans in the last month to add cryptocurrency custodian solutions. Coinbase and Bitgo, meanwhile, have regulated custodian solutions, providing products institutions can use to enter the cryptocurrency market.
Bitcoin will become part of individual portfolios eventually, he said, and more people will also view bitcoin as a store of value, similar to gold.
Galaxy teamed with Bloomberg on the Bloomberg Galaxy Crypto Index in May to track 10 digital currencies, including bitcoin and ethereum.
Bottom Already Hit?
While bitcoin surged to almost $20,000 late last year before losing nearly two-thirds of its value this year, Novogratz thinks it reached its bottom early in September. He said in mid-September that the market reached a low when a widespread selloff drove the market cap to around $186 billion.
He expects momentum to begin in the first quarter of 2019.
Novogratz is not as upbeat about cannabis -- whose recent volatility has sparked comparisons to last year's crypto rally -- but he sees some comparisons to cryptocurrency in that both have a limited supply that will become a major factor in the next five to 10 years.
Some cannabis shares have surged on reports that big companies like Constellation Brands and Coca-Cola have taken an interesting it.
Novogratz said he will invest in cannabis on a “significant sell-off from here” when the cannabis companies shed half their value.
Featured image from Flickr/Hudson River Park