This is the condition under which bitcoin (BTC) will “aim for the moon”

On Friday, April 8, bitcoin (BTC) continued to lose ground after prices crashed earlier in the week, and has since lost over $4,000. Right now, the king of cryptocurrencies is trading at $42,845, and those losses are reflected in other digital assets, even as the broader market faces hundreds of millions of dollars in liquidations.

The condition for bitcoin (BTC) to take off

Bitcoin (BTC) is currently registering a significant drop of its value. What justifies this situation? According to Michael Novogratz, the reason is quite simple: the FED’s intervention in the digital asset market. Indeed, with its new policy, the institution intends raise interest rates.

During his speech given at the Bitcoin 2022 conference, the billionaire did not hesitate to attribute the depreciation of BTC to the “Central Bank’s hawkish attributes under Jerome Powell’s leadership causing investor dismay”. For him, the only condition for BTC to take off and “aim for the moon” is that the FED pauses its aggressive policy of fighting inflation.

In a document released in March, the Fed said it was considering raising US interest rates by half a percentage point, raising the possibility of future meetings if inflation soars. Furthermore, although many senior FED officials were also prepared to raise the bank’s benchmark rate by 50 basis points in March, this did not materialize, suggesting that the next meetings of the institution will focus on the theme of BTC.

We’re not sure we trust the dollar

During his speech, Novogratz reiterated his prediction of BTC reaching $500,000 and then $1 million, saying that adoption of the digital asset is rapidly approaching “breaking phase”. The CEO of Galaxy Digital also remarked that the dollar had lost its status as a “risk-free” currency, especially after the face-off between the United States and countries like China and Russia. According to him, as a result of this showdown, it became clear that BTC is a better value than the US dollar.

“The genesis of bitcoin is that it was born out of a breach of trust,” underlined Mr. Novogratz. “Look at China’s foreign minister who just said we’re not sure we can trust the US dollar.”

As we write this article, the Russian currency rebounded and has seen its value rise significantly more than the US dollar, despite sanctions on Russia following its invasion of Ukraine. This seems to clearly demonstrate that the US dollar no longer has a monopoly on the market.

The FED’s aggressive policy towards cryptocurrencies, especially bitcoin (BTC), has significant effects on the sector. According to Michael Novogratz, it is only when this policy ceases that BTC will take off.

Source: ZyCrypto

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