If you’re wondering why the bitcoin price suddenly tanked yesterday, you can blame Michael Novogratz. We’re kidding, of course, but the Galaxy Digital CEO has been selling some of his holdings, according to an interview he did with CNBC.
On Wednesday, the BTC price reached nearly $14,000 before suddenly falling off a cliff to where it’s currently hovering at roughly $11,000 on CoinMarketCap. The precipitous drop happened in a matter of minutes, sending Crypto Twitter into a bit of a tizzy. While Novogratz is a bitcoin bull, he took the opportunity to cash in just as some bitcoin whales did, saying to the business network that he could have unloaded more:
“I sold a little bit. I wish I sold a lot. I think we’re going to be in a range between $10,000 and $14,000. I think we put a tradeable top in yesterday. It was parabolic, it was a frenzy.”
Novogratz reportedly plans to buy the dip at $10,000. But if you’re waiting for the bitcoin price to revisit 2018 levels, he has some bad news for you, saying:
“You’re not getting in at $4,000.”
— Squawk Box (@SquawkCNBC) June 27, 2019
Facebook and China Fueling Gains, Says Novogratz
Bitcoin has taken center stage again after reminding the world just what it’s capable of with the recent price run-up. Even though the flagship cryptocurrency has fallen by a double-digit percentage once again, it’s back on the radar of Wall Street. Novogratz believes the reasons are three-pronged, comprised of Facebook’s Libra coin, institutional investor demand, and “capital flight from China.” He said:
“If you’re an institutional investor who is getting close and still worried about investing, it makes you that much more confident. And so we’re seeing institutions move into the space. And this run wasn’t institutions, it’s people frontrunning them.”
Novogratz, who previously managed a hedge fund on Wall Street, also pointed to China where “huge amounts of volumes” are originating from Asia. The thing about China is the government is only making it more difficult for people to move money out of the country. So it’s “capital flight from China” through BTC, albeit illegally. The government is looking to gain more control of the yuan, but this has only driven Chinese investors into the arms of bitcoin.