Bitcoin really hasn’t done well in the past few quarters, with the price of the leading cryptocurrency tanking from $14,000 to as low as $6,400 in mere months. This means that at its worst, BTC was trading down 55% from its 2019 high.
Despite this, a prominent cryptocurrency fund manager and former Wall Street executive is starting to get bullish on the cryptocurrency once again, citing a weird reason that may not be the first on the mind of cryptocurrency investors.
Iran Situation To Help Bitcoin: Novogratz
On the evening of January 2nd, U.S. officials confirmed that Iranian General Qassem Soleimani was killed in Baghdad in an airstrike directed by President Donald Trump.
Due to Soleimani’s status as a key leader in Iran, media — mainstream and social media alike — erupted; every commentator was trying to weigh in on what this event meant for foreign policy, a potential World War 3, oil, and — you guessed it — Bitcoin.
Bitcoin, after all, is increasingly being seen as a safe-haven investment, with some commentators like former Wall Street executive Raoul Pal lumping the orange coin in with gold, silver, and so on and so forth.
Michael Novogratz added fuel to this narrative on January 5th. The former Goldman Sachs partner and current chief executive of “crypto merchant bank” Galaxy Digital wrote on Twitter: “The more I analyze this Iranian situation, the more bullish gold and BTC I become.”
The more I analyze this Iranian situation, the more bullish gold and $btc I become.
— Mike Novogratz (@novogratz) January 5, 2020
The investor elaborated by writing what he expects to happen on a geopolitical scale in the coming weeks. Slightly paraphrased, he wrote: “Iran will begin to expel U.S. troops. Iran will have more influence in Iraq, which is what they want. The Saudis don’t want conflict. Due to all this, the Middle East will become less stable, creating more volatility in global markets.”
The idea with Novogratz’s comments being that in times of geopolitical and macroeconomic instability, Bitcoin should rise due to the asset being seen as decentralized, non-sovereign, and scarce.
Where Does Novogratz Think Bitcoin Will Go?
In these tweets regarding the latest Iranian crisis, Novogratz didn’t give his followers a price prediction for Bitcoin. But in previous interviews and tweets, he has.
Prior to New Year’s Eve, Novogratz wrote that one of his predictions for 2020 is that he expects for Bitcoin to finish this year above $12,000 — 60% higher than current prices.
2020 prediction #1. @realDonaldTrump loses by more than 10mm votes. #2 $btc finishes over 12k. #3. @USAWrestling wins 3 golds in Tokyo (MF). #4 @tomhanks wins the Oscar for Mr Rodgers. #5 @reform and it’s partners help shrink the ‘supervised’ population from 4.5mm to 4mm or <
— Mike Novogratz (@novogratz) December 28, 2019
And in an interview with CNN published in October of 2019, the investor was quoted as saying that he expects for Bitcoin to have achieved a new all-time high above $20,000 by early-2021.
Other Bullish Factors
As to why Novogratz expects Bitcoin to be at least $12,000 by the end of the year and potentially above $20,000 sometime in “early-2021,” he has cited a number of other factors.
Per previous reports from Blockonomi, the prominent Bitcoin proponent has most often looked to the entrance of institutional investors as a potential bullish catalyst for Bitcoin. Indeed, the theory goes that as mainstream investors on Wall Street, who manage a majority of the world’s wealth (and thus power), start to trickle into the cryptocurrency space, Bitcoin and others will be validated and will also begin to see vast capital inflows, driving up prices with time.
Novogratz has also cited macro factors, like the existence of negative interest rates, which should theoretically drive investors towards alternative zero-yield assets like Bitcoin and gold, and the growing levels of mistrust in centralized institutions.