$10,000 is not the height of Bitcoin. The total market value of cryptocurrencies will reach $2 trillion in 2018

Bitcoin continues to rise, having officially surpassed $10,000 on all major exchanges at press time. Billionaire trader and long-time cryptocurrency bull Mike Novogratz has predicted that the total cryptocurrency market capitalization will reach $2 trillion by the end of 2018.

Mike Novogratz: Cryptocurrency Market Value to Reach $2 Trillion in 2018

The founder of Galaxy Investment Partners, the world’s largest cryptocurrency hedge fund with an estimated size of $500 million, gave his predictions on CNBC’s Fast Money, explaining that while he would not be surprised to see a short-term market correction after this quarter’s incredible surge, he believes the long-term fundamentals of the market are good and worth looking forward to.

“I have a feeling this is going to continue. When I try to think about valuations, Bitcoin really has the use case of digital gold.” He estimates that Bitcoin will need to grow 30 to 50 times to match gold capitalization.

A few weeks ago, Novogratz predicted that the price of Bitcoin would reach $10,000 by the end of this year. Yesterday, several Bitcoin exchanges in South Korea officially broke through the $10,000 mark, which is $100 to $200 higher than the global average price. Bitcoin continues to rise, and the price of Bitcoin on major exchanges around the world has generally exceeded $10,000.

While many analysts continue to deride Bitcoin as a bubble, Novogratz — who says 30% of his net worth is in crypto assets — believes the cryptocurrency market is too small to be considered a repeat of the dot-com bubble at the turn of the millennium.

“The total market capitalization of the cryptocurrency market is $300 billion. This is nothing. During the dot-com bubble in 1999, the market capitalization of companies on the Nasdaq reached $6 trillion, and the Nasdaq was a bubble led by the United States. Cryptocurrency is “a global phenomenon”, and most trading volume is concentrated outside the United States.”

While Novogratz said he would not be surprised to see a “backfill” in the short term, he believes that unless regulators do a “U-turn” or there is a major exchange hack, cryptocurrencies will recover and continue to climb rapidly higher.

He said, "In the medium term, the market value of cryptocurrencies will be much higher." His recently expressed medium-term target of $1 trillion is conservative. He now believes that the market value of cryptocurrencies will reach $2 trillion by the end of 2018, which is 6 to 7 times the current level.

If investors can resist the urge to take profits, he said the long-term outlook for the cryptocurrency market is more attractive, especially for bitcoin and crypto assets in general.

“If gold can have an $8 trillion market cap, I wonder why Bitcoin can’t.”