A former hedge fund manager says bitcoin is headed to $10,000 in 6-10 months
The Bitcoin bubble will continue blowing up until it inevitably pops, according to Michael Novogratz, a former manager at the $72 billion investor Fortress.
"It would not surprise me if, in the next six to 10 months, we're over $10,000," Novogratz told CNBC on Tuesday. Bitcoin traded near $4,823 per dollar at 11:31 a.m. ET on Monday, up 657% for the year.
At a recent meeting with institutional investors in San Francisco, he realized the "herd" was approaching to cash in on the booming demand for cryptocurrencies. The CEOs of major investment banks including Morgan Stanley and Goldman Sachs have recently commented publicly on bitcoin.
Novogratz is starting a $500 million crypto fund that invests in bitcoin, ethereum, and initial-coin offerings.
"Yes, it's a bubble," Novogratz said. "It's going to be one of the great manias of all time."
He said bubbles typically happen around things that that fundamentally change the way we live, like railroads and the internet.
"We could never have understood the ubiquity of the internet in 2017 even at the height of the bubble," Novogratz said. "Ten years, 15 years from now, blockchains and decentralized systems will be everywhere."
Bitcoin is the bellwether of this "decentralized revolution" and is the easiest way for investors to get exposure, Novogratz said. He's betting that the underlying technology of bitcoin, which creates a decentralized and permanent ledger of every transaction made on the network, will thrive into his four kids' adult lives.
"One day their boyfriend's going to give them digital flowers and they're going to enjoy the flowers," Novogratz said. "My mom would say 'I want real flowers.' As we move into a digital world, having a digital store of value makes more and more sense."