Michael Novogratz Sees ‘Shocking’ Developments in Crypto Industry
A week after crypto investor Michael Novogratz called a bottom to the crypto markets, he explained his current thinking at a Yahoo Finance conference. As many cryptocurrencies are seeing positive price action, especially Ripple (XRP), Novogratz sees multiple things going right for the space, though he doesn’t seem to think a new mega-rally will take place anytime soon.
Subscribe to the Bitsonline YouTube channel for great videos featuring industry insiders & experts
‘Shocking’ Developments Happening in the Crypto Space
Speaking with Julia La Roche at the Yahoo Finance’s All Market Summit on September 20th as the sole guest to comment on cryptocurrencies, Michael Novogratz, founder and CEO of Galaxy Investment Partners, said he still views the crypto markets with rose-colored glasses, despite the massive sell-off they’ve endured in 2018.
While admitting that the sharp rise of the crypto market in late 2017 and early 2018 was a ”classic speculative retail mania,” Novogratz, who is a former partner at Goldman Sachs and Fortress Investment Group, said he was still bullish on crypto, not least because he believed that established financial institutions are moving towards investing in the new markets.
To that end, Novogratz said:
“It’s shocking at how much is happening. And I think in the next two to three months, you’re going to see a bunch of major announcements around the things that institutions need to invest.”
Per Novogratz, custody solutions are the most glaring need for large investors, but he also predicts movements in “banking and other parts of the asset management space.”
He said that banks are going to going to experience “institutional FOMO” just like retail investors did in the previous bubble. He also noted that 18 months ago, his firm had four employees, while it currently has 75, and that it had just hired a capital markets expert with 18 years’ experience working at Goldman Sachs.
After #Callingabottom, Ripple Moons
On September 13th, Novogratz, whose firm is behind the Bloomberg Galaxy Crypto Index (BCGI) which was started in May of this year, tweeted that he believed the crypto markets would go no lower:
At the time of that tweet, the BCGI, which is a composite index of multiple cryptocurrencies including bitcoin, ether, XRP, XMR, and Zcash, was trading at around $400 USD. Today, September 21st, it is around $511 USD, an increase of 26 percent. While things move fast in the crypto markets and a new crash could come at any moment, at this point Novogratz’s prediction is looking prescient.
Part of the increase of the BCGI is due to Ripple (XRP), which passed ether (ETH) today to become the second-largest cryptocurrency by market cap. That came as XRP surged by as much as 100 percent on-the-day to reach 76 cents USD before pulling back a bit once more.
Renaissance for Bitcoin, Security Tokens Could Be on the Way
Novogratz also said that bitcoin is going to have a “renaissance” soon, because when major institutions decide to get into the crypto markets, it will be the first investment they make. He also said that his firm, and many others, were working on security tokens, which would be part of a securities-law compliant crypto-based fundraising system.
Despite his positivity, Novogratz also said he didn’t think the crypto markets would bounce back quickly. He argued it was more likely that it will take another 9-12 months before the release of commercially viable and production-ready cryptocurrency or blockchain applications, which could then act as market catalysts.
Decisions on Van Eck, SolidX Bitcoin ETF’s delayed
News also broke yesterday that a decision by the U.S. Securities and Exchange Commission (SEC) on the approval of bitcoin exchange-traded funds (ETFs) by Van Eck Securities Corp and SolidX Management would be pushed back until at least the end of the year. The SEC has invited public comment on the proposals, and according to Bloomberg, has until at least late December to make a decision on the ETFs, which are seen by industry observers as a key test of crypto adoption by the traditional financial industry.
Have your say. Is Michael Novogratz’s positive assessment of the crypto markets correct? Or has he been drinking too much of the crypto Kool-Aid?
Images via Twitter, Pixabay