Billionaire Mike Novogratz explains why Bitcoin needs a macro and regulatory boost to hit new highs

Mike Novogratz, the CEO of Galaxy Digital, recently discussed his thoughts on the possibility that Bitcoin may hit new all-time highs (ATH), highlighting the need for major shifts in macroeconomic circumstances in order for this to happen.

Forbes lists the billionaire as the 1368th richest person in the world, with a net worth of $2.5 billion (as of May 18, 2024). In a recent interview on Galaxy's podcast, he said that he thinks Bitcoin will likely stay in its current trading range until the Federal Reserve lowers interest rates, which he sees as a bullish sign for the market leader.

More pro-crypto regulations, Novogratz pointed out, might help push Bitcoin to all-time highs. He noted that the popular belief that the economy is slowing down might work to Bitcoin's advantage.

He does not, however, believe that Bitcoin will reach its previous peak of $73,000 in the near future unless the Fed steps in or there is a significant regulatory development, both of which he regards as unlikely.

Novogratz's Bitcoin prediction

He stated his prediction that the price of Bitcoin will fluctuate between $57,000 and $73,000, or between $55,000 and $75,000. Both the low and high ends of this range, in Novogratz's opinion, have already been determined.

As the election draws near and it becomes more likely that Federal Reserve Chairman Jerome Powell will consider cutting interest rates, he anticipates an upward movement.

Furthermore, Novogratz mentioned that the US federal government's large spending and mounting debt could encourage more investors to turn to Bitcoin, which they see as "digital gold." He pointed out that although national debt and cryptocurrency regulation are opposing issues, the latter may actually contribute to Bitcoin's ascent.

He also contended that it would not be good for Bitcoin if the Biden or Trump administration addressed the federal budget deficit, which is currently at 26% of GDP, much higher than the target of 20%.

On the other hand, he pointed out that bad policy and overspending by the government might help boost the value of Bitcoin, similar to how gold prices have risen but more quickly because Bitcoin is a relatively new technology and commodity.

Well-liked within the cryptocurrency community, Willy Woo is well-known for his predictive insights and data-driven market analyses.

Having moved into the cryptocurrency space in 2013, Woo, the founder of The Bitcoin Forecast newsletter, brings a wealth of traditional finance and trading experience. He is especially well-known for his on-chain analysis and the creation of tools such as the Network Value to Transactions (NVT) ratio, which functions similarly to the price-earnings ratio in stocks by comparing the market capitalization of Bitcoin to the volume of transactions.

According to a noteworthy insight shared by Woo on the social media platform X on May 15, 2024, global liquidity is forming a bullish ascending triangle, with a breakout predicted before October 2024.

He clarified this later that day by naming the M2 Money Stocks for CNY, USD, EUR, JPY, and GBP as well as the other global liquidity components he was examining. He gave a thorough formula to use Trading View tickers to monitor this liquidity.

It is necessary to comprehend what M2 means in economics in order to comprehend Woo's analysis. A large range of liquid assets are included in the money supply as measured by M2.

M1 (cash, demand deposits, and other checkable deposits) and other near money products like savings accounts, small-time deposits (CDs under $100,000), and retail money market mutual funds make up this category.

M2, which offers a more complete picture of the money supply than M1 alone, is an essential metric for economists and decision-makers.

Woo evaluates the overall liquidity in the world economy by looking at the M2 money stock for the main currencies: the British pound (GBP), the euro (EUR), the Chinese yuan (CNY), the US dollar (USD), and the Japanese yen (JPY).

To create a unified metric of global liquidity, his Trading View formula merges the M2 money supply of various currencies, adjusts for their exchange rates against the USD, and then combines the results.

Woo brings up the idea of a technical analysis pattern known as a "bullish ascending triangle," which suggests a possible upward breakout. A sequence of higher lows that form a rising trendline and converge with a horizontal resistance line define this pattern. Price breakouts above the resistance line usually indicate a robust bullish trend.

Woo's prediction of a breakout before October 2024 implies that he expects a major rise in global liquidity, which may drive up the price of Bitcoin.

According to him, who predicts that Bitcoin will set new records in 2025, these liquidity conditions will make the climate for Bitcoin extremely favorable, possibly pushing prices to previously unheard-of heights.