In a recent interview on CNBC’s Squawk Box, Michael Novogratz, the founder and chief executive of Galaxy Digital hedge fund, shared insights on bitcoin’s current trajectory, potential corrections, and the impact of recently-launched Bitcoin spot Exchange-Traded Funds (ETFs) on the market.
With bitcoin recently establishing a new all-time high at $73,637, questions lingered about the possibility of a major correction. Novogratz acknowledged the potential for a correction, stating:
“Things are frothy, funding rates are high, and so in times like this, you always have to be ready for a correction.”
Despite this, he expressed confidence, stating, “I don’t think we’ll go back below $50,000, $55,000.”
Michael Novogratz And ETFs Inflows
The Galaxy Digital CEO highlighted the recent historic peak of bitcoin and its current trading price around $73,000. A noteworthy aspect of the current market dynamics, according to Novogratz, is a “mindset shift” following the approval of spot Bitcoin ETFs.
He emphasized that as long as these ETFs continue to absorb bitcoin from the market at a high rate, the digital asset is likely to maintain its upward momentum.
The billionaire noted that Baby Boomers are entering the bitcoin space through registered investment advisors, signaling a broader demographic engagement. Additionally, he highlighted ذitcoin holders’ unique preference to evaluate net worth in terms of bitcoin holdings rather than traditional currency.
Record Net Inflow
Traders are closely monitoring the data on spot Bitcoin ETFs acquiring BTC, making it a key factor in their trading decisions. According to the latest data by BitMEX Research, since the launch, all the ETFs have recorded a combined inflow of over $11.1 billion.
On March 12, a record net inflow of over $1 billion was reported by these ETFs, with BlackRock’s IBIT contributing an impressive $849 million in inflow. Interestingly, the Grayscale’s GBTC recorded only $79 million in outflows.
When is the First Major Correction?
Novogratz further explained that when these net inflows turn negative, it could trigger the first major correction. Despite potential corrections, he established a new support level at $50,000, stating, “I think that’s the new floor unless something dramatic happens.”
Novogratz addressed concerns about custody preferences, stating that despite the significant accumulation by spot Bitcoin ETFs, an equilibrium will be reached. He stated:
“They’re loading up now. It will reach an equilibrium at one point. And there are a lot of people who still want to custody their own coins or have them in a foreign location custody if they don’t trust the country they’re in.”
Additionally, the executive tempered expectations regarding spot Bitcoin ETFs accumulating the entirety of bitcoin, estimating that these ETFs will probably not amass more than 20% of the total BTC.
The Galaxy Digital founder’s insights offer a comprehensive overview of the current Bitcoin landscape and the multifaceted factors shaping its future. He also expressed confidence in the digital asset’s potential to reach $100,000.
