FTX chief executive Sam Bankman-Fried is weighing in on the state of crypto after a rocky month in the markets.
In an interview with Real Vision, Bankman-Fried tells host Raoul Pal that it is possible prices have finally bottomed out, noting that other investment classes have also seen shakeouts recently.
“I don’t see any particular reasons that we couldn’t be at the bottom. And I’m not trying to say that we definitely are at the bottom, but I think the unwinding that had to happen has happened. It’s been an extremely messy last month, obviously.
One of the interesting things is that this hasn’t been just a crypto phenomenon. When you look at what’s happening in markets, you see similar things happening in tech [and] to some extent happening all over the ecosystem, where you basically just have a really large retracement of all the gains that have happened over the last year-plus in markets.”
The CEO, who Forbes ranks number two on its list of wealthy crypto personalities, attributes the latest market wipeout to the Federal Reserve not only raising interest rates but setting them higher than most investors expected.
“It was sort of triggered by the Fed. Initially by the expectation that rates were going to finally really start rising, and [then] rising more than people thought.
But at this point, the currents we’ve seen in markets, I think is out of line with what 3% interest rates would normally represent.”
Bankman-Fried concludes by noting that Bitcoin (BTC) dropping below $30,000 back in early June was likely caused by broader economic factors and not isolated to issues within the cryptocurrency space.
“I think you look at the drop-down to $30,000 in Bitcoin as really being just economically driven and driven by macro.
That wasn’t very crypto specific.”
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Source: https://dailyhodl.com/2022/07/09/cryptos-second-richest-billionaire-believes-the-digital-asset-market-has-bottomed-out-heres-why/