US credit crunch means it’s time to buy gold and Bitcoin: Novogratz

The United States is headed for a credit crunch and now is the right time to buy gold, silver and Bitcoin (BTC), says the founder and CEO of Galaxy Digital Michael Novogratz.

“We are going to have a credit crunch in the US and around the world,” Novogratz explained in an interview on CNBC. "You want to be long gold and silver [...] and you want to be long Bitcoin,” he said.

Speech Speaking on CNBC's Squawk Box on March 15, Novogratz noted that banks typically rebuild capital by lending less, which means a credit crunch is imminent, noting that indicators like the commodity market already point to a recession.

The United States the banking industry fell into crisis this month, with Silvergate Bank, Signature Bank and Silicon Valley Bank (SVB) collapsing in the same week. Moody's downgraded the outlook for the US banking system to "negative."

Related: They blame traditional finance for the collapse of Silicon Valley Bank

In the interview, Novogratz suggested that there was a change in interest rate policy, saying that while the Fed would "like to do a modest hike, just to sell credibility," doing so would be a "big policy mistake." .

Along with his prediction of tough times for the US economy, Novogratz expressed bullish sentiment on cryptocurrencies, saying:

"If there was ever a time to be in bitcoin and crypto, that's why it was created, in the sense that governments print too much money whenever the pain is too great, and we're seeing that."

Bitcoin price fell after Silicon Valley Bank collapsed last week, but managed hit new highs in 2023 of $26,514.72 on March 14, according to CoinMarketCap.