Ark Invest’s CEO predicts a massive reversal for crypto assets this year due to falling inflation and a U-turn by the Fed. Cathie Wood, began a video blog post on the company’s website on January 23 by discussing the state of the economy as a whole. She said “several signals” indicate that inflation will be declining, so “the Fed should pivot soon.”
As the macroeconomic picture brightens and people open their wallets, risk-on assets like cryptocurrency stand to benefit.
She also said that the company anticipates inflation will fall to the Federal Reserve’s 2% target. As the money supply has been decreasing, Wood has forecast that inflation could go below this level and perhaps into negative territory.
She continued, “we anticipate that will happen in the first half of 2023,” suggesting that the market was waiting for a signal from the Federal Reserve. If interest rates drop below expectations, as she predicted, Ark Invest portfolios will do quite well.
The six active Ark funds are all related to either technology or financial services. They include a cryptocurrency asset fund, blockchain venture investments, a disruptive innovation fund, and an exchange-traded fund (ETFs).
At the same time, Chief Futurist Brett Winton of Ark discussed AI, predicting rapid development in the field by 2023. The value of cryptocurrency, he said, would surge this year.
He said that when the macro climate shifts and the Fed “changes its spots,” there is a greater chance for “growth and value realization within the venture and public market space.”
After analyzing the effects of these technical advancements, Wood came to the conclusion that they are deflationary and will “create a boom in the products and services linked with this innovation.”
Recently, Ark Invest cashed out on the part of its Grayscale Bitcoin Trust (GBTC) assets and piled into Coinbase (COIN) to the tune of $320,000, or around $17.6 million.
With the launch of the Ethereum Shanghai Mainnet Shadow Fork, members of the largest smart contract network in the world may get closer to accessing the over $26 billion in ETH that has been staked.