In a recent tweet, Galaxy Digital CEO Mike Novogratz issued a bearish warning on crypto and the tech-heavy Nasdaq Composite stock market index, claiming that they will remain under pressure as long as exchange rate higher.
Dozens of broken bonds. As long as rates move higher, we should see pressure on Nasdaq and crypto. 2% seems a reasonable target for the tens.
– Mike Novogratz (@novogratz) January 18, 2022
Bitcoin is in the red this Tuesday, dropping to an intraday low of $41,650 earlier today.
The leading cryptocurrency is trading in line with the US stock market. The S&P 500 and Dow are down 1.7% and 1.6% respectively at press time.
The Treasury sell-off appears to be the main culprit behind the ongoing stock market correction. The yield on the 10-year Treasury note, the most widely watched rate, recently hit a two-year high of 1.857 percent. Novogratz said that 2% seems like a reasonable target for him, which means that the cryptocurrency could have more upside.
As reported by U.Today, Novogratz predicts that Bitcoin will underperform in early 2022 due to the weakness of the stock market.
The Federal Reserve spooked markets by adopting an increasingly hawkish tone. Banking giant Goldman Sachs expects the central bank to raise interest rates at least four times this year to combat persistent inflation. Such a drastic turn would likely bring the market to a standstill.
JPMorgan CEO Jamie Dimon recently said that the Fed could raise rates up to seven times, but he did not mention a specific timeline.
Novogratz recently forecast that Bitcoin will bottom out at $38,000.
The benchmark cryptocurrency is down more than 9% this year after gaining 60% in 2021.
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