Bitcoin and cryptocurrencies remain under severe pressure following the collapse of the major cryptocurrency exchange FTX. The bitcoin price has plunged in the past 12 months, dragging the broader bitcoin and crypto market down , though the Tesla billionaire drove the price of a bitcoin rival sharply higher.

Now, renowned bitcoin and crypto bull Mike Novogratz has dismissed his price prediction of $500,000 per bitcoin in five years, blaming the Federal Reserve’s brutal series of interest rate hikes this year.

“The biggest change that happened and the real reason Bitcoin went from $69,000 to close to $20,000 is that [Fed Chairman] Jay Powell decided to find his core banking superpowers and start attacking inflation with a series of rate hikes,” the CEO of Galaxy Digital told Bloomberg , reversing his prediction that Bitcoin will skyrocket to $500,000 by 2027, but stating that it will eventually hit that level.

“The Federal Reserve is in control and is doing a very good job, and that is the main reason crypto crashed,” Novogratz said, adding that a series of cryptocurrency company scandals has increased pressure on the market.

“The rest of this nonsense that we’ve had between Three Arrows and BlockFi and Celsius and all these companies that were mismanaged or fraudulently managed is certainly hurting overall confidence in cryptocurrency.”

This year, the Federal Reserve raised interest rates to levels not seen since before the 2008 financial crisis in response to runaway inflation that some say could get out of control.

This week, he raised expectations that the Fed may be about to shift to a dovish stance after signs that inflation may be slowing and Powell signaling that the pace of rate hikes may slow.

“Fed Chair Powell’s speech resulted in improved market sentiment by reiterating the need for caution in the fight against inflation,” BitBull Capital CEO Joe DiPasquale said in emailed comments. electronic.

“What the market is looking at now is a possible ‘soft landing,’ giving both stocks and crypto assets a breather. Going forward, the market will look to the Federal Open Market Committee meeting on December 14 to see if the next rate rise is less than 50 basis points. If so, we could see another injection of bullish sentiment, possibly taking the bitcoin price to $20,000.”

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