- Mike Novogratz is bullish on cryptocurrency, especially the two largest coins, Bitcoin and Ethereum.
- The Galaxy Digital CEO says BTC and ETH have been the best risk-adjusted investments over the past few years.
- He also suggested during the company’s earnings call that the United States risks losing its leadership in finance and innovation.
Galaxy Digital CEO Mike Novogratz says crypto is in “a good moment,” noting that Bitcoin and Ethereum have been the best risk-adjusted investments globally over recent years.
The billionaire investor made these remarks while discussing the crypto market outlook on Galaxy Digital’s earnings call. He said:
“I look right now and say, ‘What’s the good?’ Bitcoin is trading over $27,000, Ethereum over $1,700. On a risk-adjusted basis — volatility adjusted, Sharpe ratio adjusted — Bitcoin and Ethereum have been the two best-performing assets in the world this year. They’ve been the two best-performing assets in the world over the last two years. So, whatever Jamie Dimon wants to say, whatever the Biden administration wants to say, they’re just wrong, and the world knows that.’”
Steve it has outperformed all assets ytd, over 2 years and 3 years on a risk adjusted weighting (sharpe ratio) It’s been safer than JPM and Google. Run the numbers yourself. https://t.co/uA15XaoUTo
— Mike Novogratz (@novogratz) March 28, 2023
Novogratz explains what’s driving crypto
Bitcoin tested resistance near $29,000 in 2023; its recent price around $28,650 represents a strong year-to-date gain. Ethereum has traded above $1,800 as investors watch the $2,000 level, and its price is roughly 61% higher year-to-date according to market data.
Novogratz believes recent price action positions the top coins for further gains in the coming months. In the earnings call transcript he said that much of the selling that needed to happen when crypto prices fell has already occurred.
He also pointed to retail investors as a key driver of the recent appreciation.
“What’s promising, and what has driven crypto broadly this year, is two things. One, all the selling that needed to get done got done, right? There was so much bad news — if you had to sell, panic selling and just the nervousness of ‘Oh my God! This thing could go to zero,’ and people were in sheer panic; you had seller’s exhaustion. But you’ve had Asia reopen. China has — you know, post the Xi protests around COVID Zero, China took the regulatory boot off the necks of their tech companies, and that includes crypto, so you’re seeing, with Chinese traveling, you’re seeing more activity from Asia.”
Bitcoin could be “substantially” higher in a few months
Novogratz also sees the current adoption wave across the Middle East, Hong Kong and Europe as positive for the crypto industry, while warning that the U.S. risks ceding leadership in financial markets and innovation.
He described the Biden administration’s approach to crypto — including enforcement actions and prosecutions — as short-sighted.
On his outlook for Bitcoin and the broader crypto market, the Galaxy Digital CEO added:
“The market feels strong, and when I look at it technically on charts, we’ve had big weekly closes. I’m surprised to hear myself say this, given where my mindset was in late December, but it would not surprise me if we were substantially higher three months, six months, nine months from now.”