Mike Novogratz, CEO and Founder of Galaxy Digital Capital Management, a cryptocurrency bank, has hit back at the sector’s critics, dubbing cryptocurrency “a people’s revolution”.
Speaking to CNN Money, former Goldman Sachs partner and Fortress Investment Hedge Fund manager Novogratz hit back at high-profile voices like Bill Gates and Warren Buffett, who have attempted to take cryptocurrency investors to task recently. In contrast, and as befits his admission that up to 20% of his assets are in crypto, he sees it as a sector that is driven in a very different way than the institutionally led finance markets we are used to.
“In many ways this was a millenial-led revolution, it was a retail-led revolution. Last year, 98% of investing in it was through retailers [as opposed to institutional investment]. I call it a ‘people’s revolution’ it was a response against the breakdown of trust in central authorities”
He went on to highlight the point by adding: “If a guy’s got grey hair, they’re much more sceptical.”
When asked who he felt should be investing in cryptocurrency right now, Novogratz was also predictably ebullient:
“I think it’s essential for almost any investor to have 1-2% of their portfolio in it [crypto],” he told Maggie Grace. “Not necessarily because of the gains they’re going to make, but because these technologies – in 2-3 years – are going to give every vertical a challenge. I’m not saying the decentralised version of Uber will beat Uber, but it’s going to be a challenge and it’s gonna have a real value proposition. So it’s almost irresponsible not to have something on the table – because if you don’t have a chip on the table, you never pay attention.”
“Governments can throw you in jail and they can fine you, so there’s going to be strong KYC and AML going around the money piece of it. But Uber can’t throw me in jail if I beat their business… The real revolution is going to happen in these verticals.”
As has been reflected in recent news, Novogratz does see big financial institutions shifting their attitude towards the crypto market, however.
“I think you’re seeing the herd of major institutions slowly moving,” he said. “We’re in the New York Stock Exchange, and I’d be shocked if in six months time they’re not participating in some form. So we are cleaning the game up.”