Mike Novogratz, the CEO of cryptocurrency investment firm Galaxy Investment Partners, is hailing cryptocurrencies as a ”people’s revolution”. Nonetheless, he also emphasized the importance of institutional investors. Novogratz also expressed his belief that established financial institutions will flock to cryptocurrencies this year, stating that he is feeling more optimistic for the cryptocurrency industry as a whole now than he was this time last year.
Novogratz made these comments at the Fluidity Summit in Brooklyn this Thursday. Novogratz rose to fame as a hedge fund manager and has most recently been running a cryptocurrency investment firm. His talk mainly centered around the notion of institutional investors making an entrance into the cryptocurrency space. Moreover, he also talked about the recent announcement of the Bloomberg Galaxy Crypto Index, an index which follows the most liquid blockchain assets.
He went on to propose that the launch of the Bloomberg Galaxy Crypto Index might lead more institutional agencies to explore the possibility of investing in Bitcoin and other cryptocurrencies. Although Novogratz was very clear in his vision that it will be regular people driving the long-term growth of cryptocurrencies, through paying for every-day services such as taxi-rides or sending money to each other, he also noted that it is important for the cryptocurrency sector to be viewed as attractive by institutional traders.
Novogratz has recently had staff meetings with established banks such as Goldman Sachs, Deutsche Bank, and the New York Stock Exchange, and proposed that banks may move to adopt cryptocurrency as soon as this year. As a matter of fact, Goldman Sachs recently announced their intent to open a dedicated trading desk for Bitcoin, showcasing that financial institutions are no strangers to cryptocurrency. Novogratz illustrated his belief that banks are already taking action to adopt cryptocurrencies by stating that ”the institutional herd is on the move”.
Furthermore, Novogratz is of the opinion that investors are not valuing cryptocurrency coins properly. During the talk, he argued that most have not considered why tokens have value or understand how they actually work. He also disputed the notion that a protocol or token’s value can drop to zero if buyers do not give sufficient value to buyers. Rather, he argued, a token acts a financial future for the related protocol. He likened the mechanics of valuing tokens to that of more traditional financial assets, such as equity. Nonetheless, he reiterated his belief that cryptocurrencies will affect regular people the most, since ”the decentralized revolution is going to have its biggest impact in the retail sense” – once the institutional players get onboard, that is.
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Rasmus Pihl is a writer for Toshi Times by day and an avid follower of the cryptocurrency industry by night. Rasmus holds a Bachelor’s Degree in Marketing from the Gothenburg School of Business, Economics, and Law and runs a Swedish marketing consulting firm. Moreover, when he isn’t writing for Toshi Times, traveling, working or changing the world in some other capacity, Rasmus is more than likely caught up in postgraduate studies.