Bitcoin billionaire Sam Bankman-Fried says digital assets could come in a ‘fall’ instead of the ‘winter’ that many fear. The young billionaire thinks the Fed will continue to be the main driver of digital asset markets in the months ahead.
Bitcoin millionaire: It’s autumn, not winter
Bitcoin and other cryptocurrencies have slumped since hitting record highs in November as investors prepare to raise interest rates as the Fed grapples with high inflation. Sharp declines in stock markets and low trading volumes have given rise to rumors of a “crypto winter” where prices plummet and remain low for a year or more.
But Bankman-Fried, co-founder of the FTX crypto exchange in 2019, said in a statement that he doesn’t really think it’s a winter, and he still sees a lot of activity and a lot of excitement in this space. Sam Bankman-Fried states that there may be a crypto “fall” rather than a “winter” and states that the Fed will continue to be the main driver of digital asset markets in the coming months.
Sam Bankman-Fried, 29, who has nearly $25 billion in assets, says Fed policy is currently the biggest driver of the crypto market. Cryptocurrencies have fallen sharply as the Fed prepares to end stimulus that has fueled riskier investments in 2020 and 2021, with shares in fast-growing but unprofitable tech companies.
Investors have turned to more economically sensitive bets such as bank stocks and commodities. Bitcoin tumbled after hitting $69,000 in November, trading at around $44,000 on Wednesday, and other major tokens like Ethereum experienced similar dips. Bankman-Fried comments:
As long as Fed policy continues to be one of the main drivers of market movements, we will likely continue to see this fairly strong correlation in the coming months.
Any crypto slowdown hasn’t dampened investor enthusiasm for Bankman-Fried’s FTX exchange. Earlier this month, it raised $400 million from major investment firms to a valuation of $32 billion.