- Galaxy Digital CEO Mike Novogratz said the US is heading towards a credit crisis and a dramatic economic downturn.
- The crypto bull explained how this makes bitcoin's investment case even stronger.
Galaxy Digital CEO Mike Novogratz said a dramatic economic downturn and a US credit crisis are ahead, adding that a gloomy macro environment will only make bitcoin's investment case stronger.
The long-time cryptocurrency bull also said that the failure of Silicon Valley Bank and aggressive central bank tightening highlighted bitcoin's initial use case — as a safer alternative to the traditional monetary system.
In fact, the industry has been "re-galvanized," per Novogratz, "by the reality that we have too much debt in the US and abroad and that this debt orgy that we were all on for so long has a price to pay," he told Bloomberg on Wednesday.
"You're seeing that in this balance between a Federal Reserve [that's been] fighting inflation and maybe moving rates a little faster than the market participants knew how to manage," he added. "Now, we're going to have a credit crisis in the US and the economy is going to slow... It's going to slow pretty dramatically."
Crypto markets have been on a tear recently, despite the broader downturn in risk assets like stocks as well as the increased regulatory scrutiny on industry giants like Coinbase and Binance.
Bitcoin and ethereum are up 51% and 37% in the past three months, according to Messari, with the overall crypto market cap at $1.28 trillion. Bitcoin notched a 10-month high earlier this week, surging past $30,000.
"The government has kind of gone full jihad against crypto," the former Goldman partner said, "pressuring the banks not to lend to crypto companies, a flurry of subpoenas and Wells notices."
He added: "Despite all [of'] that crypto prices are higher and that gives me great optimism and confidence."