The multi-day beating that crypto is taking is worrying many investors. With nearly every player in the industry down for one reason or another, bearish attitudes are becoming louder and louder. Is the massive selloff of cryptocurrency a panicked moment, or is crypto capitulation a sign of a deeply hurting asset class?
A war has been raging among investors, analysts and writers alike. Whether or not crypto will recover is the debate topic of the week. Bitcoin (CCC:BTC-USD), the poster-child of the whole market, is at the center of the mess, with many speculating that the coin is done for as the industry leader.
Others implore that the market correction is setting up the coin to continue its massive gains.
Crypto Capitulation: Mike Novogratz’s Thoughts
Elon Musk is having his say with Bitcoin, calling it hugely consumptive of power. As such, Tesla (NASDAQ:TSLA) is rejecting the crypto. Other coins are suffering from this bit of news, as it spreads a sentiment among investors that looks down on digital currencies.
And now, the asset class is taking a blow from the Chinese government. A ban on digital currency’s use among financial institutions and payment companies is salt in the ugly wound that crypto is suffering this week.
Mike Novogratz, CEO of Galaxy Digital Holdings (OTCMKTS:BRPHF), is not convinced that crypto is dying. Novogratz is saying that the selloff does “feel like capitulation” today. He even goes as far as to call the selloff a “liquidation event. But it’s not the end, according to the crypto bull.
“Humpty Dumpty never gets put back together in two days,” he told CNBC. Investors will get up and brush off the dirt. Novogratz is making clear that he and many others still have a deep interest in DeFi, and says that there is still a “movement” in crypto that is sure to carry on.
Regardless of how much the current situation hurts, Bitcoin is still up huge relative to last year. The coin is up over 200% in the last 12 months, even with the price drop. As a barometer of the asset class, he sees that as a very positive reading.
On the date of publication, Brenden Rearick did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.