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Federal Reserve chair could slow down the crypto market, warns Mike Novogratz

Federal Reserve chair could slow down the crypto market, warns Mike Novogratz

Last updated 5th Aug 2022
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The CEO of Galaxy Digital and former Goldman Sachs executive, Mike Novogratz, has warned die-hard cryptocurrency bulls that Jerome Powell (head of the Federal Reserve) might slow down the crypto market in his second term reappointment.

Novogratz said that Powell will try to gag digital currencies by acting “more of a central banker than a guy that wants to be reappointed.”

The former Goldman Sachs executive speculates high rates will increase faster than we all expect, slowing down “all assets including the NASDAQ and crypto market”.

Powell’s reappointment will affect the crypto industry

Mike Bailey, director of research at FBB Capital Partners, also cautions on the adverse effect of Powell’s reappointment, adding it will disrupt the crypto industry.

Bailey recently told crypto bulls enthusiasts that Powell’s second term in office will challenge their views, especially since most of them view digital currencies such as Bitcoin as a hedge against the Federal Reserve’s loose policy.

Equally, Douglas Boneparth, Bone Fide Wealth’s President of the financial advisory, added that no one knows how exactly the crypto markets will react without support from the Federal Reserve.

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Institutional investors clamoring for crypto

Amid the warnings, Novogratz is subtly enticing institutional investors to put money into crypto. He currently remains bullish about cryptocurrencies’ future, saying many institutions are massively buying crypto through his Galaxy Digital company.

He claims one of the biggest global sovereign wealth funds decided “on a go-forward basis to start putting money into crypto” after consulting him on phone.

“I’ve had the same conversations with big pension funds in the United States,” he adds.

The CEO of MicroStrategy, Michael Saylor, recently projected that Bitcoin might scale new highs in the coming months and morph into a $100 trillion asset class.

We can only wait and see how the popular digital asset will fair in the volatile market. Currently, Bitcoin prices have stabilized to $57,193, up from $56,000 last week.

Goldman Sachs investment bank around May (this year) hinted that the fear of missing out (or FOMO) was driving institutional investors to buy more Bitcoin than ever.

Jerome Powell was reappointed in office by the US President Joe Biden to serve his second four-year term as the Federal Reserve Chairman.

On the flip side, Governor Lael Brainard was also promoted to vice-chairman. He was among the candidates running for the prestigious spot.

Walter Akolo

Walter Akolo

Walter is a writer from Nairobi, Kenya. He covers the latest news on the cryptocurrency market and blockchain industry. Walter has a decade of experience as a writer.