Bitcoin: From 70% drop to 1,300% jump, Novogratz, Draper and more chime in on future

Trying to figure out where bitcoin’s going to go in 2023? You’re probably better off asking a Magic 8 ball.

Bitcoin is down some 65% over the past year and the outlook for 2023 is … a mixed bag.

Last week, Galaxy Digital’s Mike Novogratz dropped his very optimistic prediction that bitcoin will reach $500,000 in the next five years. Meanwhile, venture capitalist Tim Draper reaffirmed his call that it can hit $250,000 in the new year.

And then you have Standard Chartered, which foresees gold reclaiming the haven title from bitcoin, which the bank predicts will collapse to $5,000.

The forecasts come as bitcoin clings to close to $17,000, down from a record of more than $69,000 last year, and following the collapse of Terra Luna in the first half of 2o22 and more recent falls of FTX, BlockFi and more. What 2023 might have in store for the cryptocurrency is anyone’s guess.

VCs and CEOs have their say

Draper’s original prediction for bitcoin was that it would surpass $250,000 by the end of 2022; he revised his forecast last month to June.

The collapse of FTX has done little to dissuade the prominent investor, known for early investments in the likes of Skype, Tesla, Coinbase and Robinhood, with Draper reconfirming to CNBC on Saturday that $250,000 is still his number.

Mike Novogratz is a little less optimistic.While he dropped his prediction that bitcoin would reach $500,000 in the next five years, he’s still holding onto that number — just perhaps further out than 2027. Novogratz cited Federal Reserve Chair Jerome Powell as having the most significant impact on his plans, saying he had found his central banking superpowers.

The CEO blamed the Federal Reserve’s multiple interest rate hikes to temper inflation for the fall in bitcoin prices.

And then we have Ark Invest’s Cathie Wood. She has even more faith in the power of bitcoin, adamant it will reach $1 million by 2030. Wood recently told Bloomberg TV that once the seasons change and bitcoin emerges from the crypto winter, it will smell like roses.

Bleak outlook

Standard Chartered is decidedly on the other side of the fence, seeing gold returning to being the number-one safe haven it once was.

«Gold makes a staggering recovery in 2023, rallying 30% to over $2,250 [per] ounce as cryptocurrencies fall further and more crypto firms succumb to liquidity squeezes and investor withdrawals,» the bank predicted.

The bank also predicts that yields will plunge along with technology shares, and while bitcoin’s sell-off will decelerate, the damage has been done.

«More and more crypto firms and exchanges find themselves with insufficient liquidity, leading to further bankruptcies and a collapse in investor confidence in digital assets,» Standard Chartered said. Gold will «surge in demand from retail and institutional investors, as well as sovereign nations looking to shore up their reserves.»

Time will tell.

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