Tech
BlackRock, Worldcoin, Ripple: Bitcoin bull Mike Novogratz bets on cryptocurrencies
As Bitcoin regains strength after a year of scandals and losses in the cryptocurrency industry, Mike Novogratz says one man in particular gives him reason to remain bullish.
“The most important thing that happened this year Bitcoin it’s Larry Fink,” Novogratz said, referring to the investment Titan who is CEO of BlackRock Inc., the world’s largest asset manager.
BlackRock wowed the crypto community in June when it applied to launch an exchange-traded fund to track the spot price of Bitcoin — a move that, if approved, could potentially spark a new wave of investment in the sector cryptocurrency. But it was Fink’s apparent conversion from cryptocurrency skeptic to Bitcoin believer – who now considers it an “international asset” – that really got Novogratz excited.
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“He had the orange pill, as we say. The orange pill is when you take a non-believer and make them a believer in Bitcoin,” Novogratz, CEO of Galaxy Digital Holdings, told David Rubenstein in an interview this week for an upcoming episode of Bloomberg Wealth. “Larry was a non-believer. He now he says, “Hey, this is going to be a global currency.” All people around the world trust it.
BlackRock’s ETF push and Fink’s evolving stance are part of an “adoption cycle” that Novogratz says could help the coin surpass its all-time high of nearly $69,000 reached in 2021, especially when it accompanied by a possible turn by the Federal Reserve towards cutting rates. This week, Bitcoin hovered between $29,000 and $30,000, after rising more than 70% year to date.
Novogratz, in a wide-ranging conversation at Galaxy’s offices in Lower Manhattan, also said that a recent ruling in the Securities and Exchange Commission’s case against Ripple Labs represents a “huge victory” for cryptocurrencies and touched on topics ranging from scanning of Sam Altman’s eyeball Project Worldcoin to Galaxy’s commitment to maintaining a presence in New York.
One of the most vocal cryptocurrency supporters of Wall StreetNovogratz, former partner of Goldman Sachs Group Inc. and Fortress Investment Group, first purchased Bitcoin when it was trading at around $100. In 2018, he founded Galaxy Digital, which provides financial services such as trading and investing banking and asset management in the cryptocurrency sector.
Novogratz’s reputation took a hit last year when a crypto project he backed, the Luna token invented by South Korean entrepreneur Do Kwon as part of an algorithmic stablecoin experiment, exploded, triggering a series of collapses in the industry . The now-infamous tattoo on his arm — a wolf howling at the moon with the word “Moon” — serves as “a good reminder of arrogance,” Novogratz said.
AI hype
His advice today, for someone with $100,000 to invest: “If they were young and had a high risk tolerance, I would buy Alibaba stock. I would buy silver, gold, Bitcoin and Ethereum. That would be my wallet. Those with a lower appetite for risk should invest 30% in such a portfolio and 70% in bonds and perhaps an index fund, she said.
When asked if Worldcoin would take off, Novogratz said “you don’t want to bet against Sam Altman right now.” (Altman, co-founder of Worldcoin, is also behind AI sensation ChatGPT.) Worldcoin uses a small device called a “sphere” to scan people’s eyeballs in order to generate a unique digital identity for online use . The token issued by the project more than doubled in value upon launch this week, before retreating from those highs. It was trading at $2.20 in New York at 6.30pm on Friday.
“I think the price can potentially go up a lot, because there is a hype cycle around artificial intelligence,” Novogratz said. “I don’t know if we’ll all use that as our identity.”
This year, a barrage of enforcement actions by the SEC against the largest cryptocurrency firms has shaken many industry players. Novogratz said the court’s recent ruling in the SEC’s lawsuit against Ripple — the judge ruled that Ripple’s XRP token was a security in some cases but not in others — gave the cryptocurrency industry a victory because it shows that ” the rules are not clear at all.”
As for Galaxy itself, even as it moves some of its operations overseas, it remains committed to New York. “I don’t see that we won’t be in the United States or in New York,” Novogratz said.
To see the full interview with Novogratz, watch Bloomberg Wealth with David Rubenstein on Tuesday, August 8 at 9pm Eastern Time on Bloomberg Television.