ARK Invest founder Cathie Wood says the driving force behind the recent crypto market correction is connected to a trend happening in the equity markets.
In a new video on the ARK Invest YouTube channel, Wood suggests that macroeconomic uncertainty is pushing the US dollar up, putting pressure on commodities markets.
She also says that a “strike against technology, growth and innovation” is weighing on the stock market and pulling crypto assets down with it.
However, Wood suspects the strike won’t last long.
“The dollar going up suggests a flight to safety, and that is a downward force on inflation.
Commodities are priced in dollars. The dollar is going up; all other things equal, commodity prices would go down.
In the crypto markets, we’re seeing a correction. They are starting to succumb to what we’re seeing in the equity market, which is this strike against technology, growth and innovation.
We think that’s going to be short-lived.”
The ARK Invest CEO is known for having a contrarian view on inflation and high equity prices. Wood believes tech and innovation stocks are not in a bubble but instead in “deep value territory.”
“Much like the early years of ARK’s research on and investing in electric vehicles and Bitcoin, disruptive innovation seems to be in deep value territory.
Based on the last eight years of our research, the opportunities will scale from $10-12 trillion today, or roughly 10% of the global public equity market cap, to $200+ trillion during the next ten years.”
Wood also spoke of a possible scenario last month that could drive the price of Bitcoin (BTC) over 11x its current value.
“We think that the move by institutions into Bitcoin … could add $500,000 to bitcoin’s price if they moved into the tune of roughly 5% over time.”
Bitcoin is trading at $41,193.22 at time of writing, down 1.48% in the last 24 hours.
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Source: https://dailyhodl.com/2022/01/10/heres-whats-driving-the-crypto-correction-according-to-hedge-fund-veteran-cathie-wood/