In a recent interview, Galaxy Digital Holdings Inc. CEO Mike Novogratz expressed his reservations about Bitcoin’s price skyrocketing to $1 million per coin anytime soon.
Novogratz argued that such an abrupt increase could destabilize the economy and damage civil society:
“I don’t want Bitcoin to go to $1 million anytime soon […] As a guy who served the country, the last thing I want, because if Bitcoin goes to $1 million, we’ve got instability, we lose civil society, and we’re all screwed.”
This comment was made in response to Balaji S. Srinivasan, a former Coinbase CTO, and angel investor, who announced on Twitter his intention to bet $2 million on Bitcoin, reaching $1 million within the next 90 days. Srinivasan cited dishonesty from central banks, banks, and regulators toward dollar holders and depositors as his primary concern. He also pointed out an insolvency crisis in the banking sector due to undisclosed issues and mark-to-market losses.
Srinivasan criticized banks for investing in long-dated US Treasuries, which he called the “ultimate shitcoin.” He claimed that banks were misled into thinking the Federal Reserve would maintain low interest rates indefinitely, leading to risky investments. The former Coinbase CTO further condemned the Federal Reserve’s recent interest rate hikes, which he believes have exacerbated the banking crisis and caused significant losses for those who bet on long-term Treasuries.
To demonstrate his faith in Bitcoin’s potential growth amidst this alleged banking crisis, Srinivasan moved $2 million into the USDC stablecoin for his bet. He confirmed that he would place the bet with Medlock and another individual to emphasize his confidence in the cryptocurrency’s future performance.
However, a pseudonymous cryptocurrency analyst named “Pentoshi” warned that Bitcoin’s value surging to $1 million within 90 days, coupled with hyperinflation, could lead to civil unrest, riots, and restricted access to essential goods.
Referring to Srinivasan’s bold bet, Novogratz argued that it could provoke anger from the U.S. Treasury Department, stressing the importance of maintaining a positive relationship with regulators:
“When guys like Balaji say ‘I will bet you Bitcoin’s in a million’ for a fact, it drives me crazy because I think it also really infuriates the people at U.S. Treasury Department […] I think while the dollar is under attack elsewhere, it doesn’t help. And you want the regulators on your side, not in your face.”
As of 12:35 p.m. UTC on April 19, Bitcoin was trading at approximately $29,230, marking a 3.58% decrease over the past 24 hours.
The Galaxy Digital Holdings CEO talked about the state of the cryptocurrency industry, highlighting the good, the bad, and the ugly during his company’s Q4 2022 earnings conference call on March 28, 2023.
On the positive side, Novogratz emphasized the resilience of the crypto community and the strong price action for Bitcoin and Ethereum, which he claims have been the best risk-adjusted investments over the past few years. He also pointed to the significant adoption of cryptocurrencies overseas, particularly in the Middle East, Hong Kong, and Europe. These factors indicate the industry’s growth potential, and he remains optimistic about the future of the crypto market.
However, on the negative side, Novogratz criticized the US regulatory environment, which he believes stifles innovation and pushes people offshore. He called for regulatory clarity and a framework that allows legitimate players to operate in the US. Novogratz expressed frustration with the lack of clear guidance from the SEC and the politicization of the industry, urging smart people to come together and create rules that foster growth in the US.
Novogratz believes that almost every macro hedge fund likes gold and Bitcoin. He sees the demand for cryptocurrencies growing, particularly from retail investors, indicating that prices could be significantly higher in the coming months. He also discussed the challenges regulators face and the need for collaboration between regulators and the crypto community.
In addition, Novogratz outlined Galaxy Digital Holdings’ three main focuses for the year, including the markets business, the asset management business, and the infrastructure business. The company plans to re-segment its earnings by the next reporting cycle to provide more precise insights into these businesses.
Featured Image via Pixabay