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Mike Novogratz Adamant That Bitcoin (BTC) Won’t Fall To $0

Bitcoin fanatic and blockchain enthusiast Mike Novogratz, a former Wall Street hotshot, recently doubled-down on his pro-crypto sentiment, even while this infant market continues to fall victim to shortcomings.

Revolutions Don’t Happen Overnight, Crypto Included

In an exclusive interview with Bloomberg, Novogratz, a member of Fortress Financial’s top brass turned crypto-centric merchant bank chief, gave some key insight into his personal outlook for blockchain-based assets and decentralized applications. Surprisingly, the diehard, who reportedly holds upwards of 20% of his personal fortune in cryptocurrencies (like Ethereum’s ETH), maintained his optimistic outlook.

Speaking with the financial media outlet’s Erik Schatzker, Mike “Novo” Novogratz commenced the candid conversation by joking that he’s become the “ugly face” of the Bitcoin industry, a far cry from his months as the poster child (and approachable savant) of cryptocurrencies. Yet, in spite of his newfound classification as an “ugly face” of the industry, he explained that he still believes in the technology underpinning Bitcoin — blockchain — and digital assets themselves.

Still, Novo explained that “revolutions don’t happen overnight,” adding that it became apparent that 2017’s monumental rally was a bubble when “people would come up to me wanting to take selfies,” as by then, it was clear that crypto assets were slated to plateau and pullback.

The industry insider is obviously referencing the sentiment that crypto’s come up won’t be an easy task, as pushback is expected from traditionalists and pro-centralists. Travis Kling, founder and showrunner at crypto hedge fund Ikigai, recently explained to the TD Ameritrade Network that it’s early for the crypto industry, adding that a majority of Bitcoin’s 10-year history was just getting its wings off the ground.

By the same token, the cryptocurrency proponent explained that most of the publicity and development that has fallen on cryptocurrencies, namely Bitcoin, came within the last 18 to 24 months, not during this ecosystem’s come up. As such, Kling explained that the cryptocurrency revolution is a “multi-year, multi-decade” play, rather than a chance at short-term profits.

Bitcoin Will Become Digital Gold

Back to Novogratz, the Galaxy Digital representative then touched on what lies in store for Bitcoin. Echoing comments he made earlier on CNN Money, the industry chief noted that BTC will likely become digital gold, subsequently joking that the asset will become a “legal pyramid scheme.” Giving his rationale behind this claim, Novogratz drew attention to Yale University’s recent foray into cryptocurrencies, adding that some of the smartest people, like Yale’s endowment showrunner, David Swensen, see value in Bitcoin and related innovations.

Interestingly, Kling also touched on this value proposition, pointing out that there’s a non-zero chance that Bitcoin could live up to everyone’s expectations, becoming a globally-secured transaction settlement layer that is immutable, decentralized, censorship-resistant, and cost- and time-effective, while hosting the second coming of gold at the same time. He added that even if BTC only amounts to 10 percent of gold’s market capitalization, there is still nine times growth potential for the popular digital asset.

Yet, some say that the market capitalization of BTC could surpass that of gold itself, as stated by Bobby Lee and Adam Back.

In the end, summarizing his points, Novogratz noted that BTC at $20,000 was a “drug,” but then added that he wouldn’t be caught dead stating that it’s going to zero. Instead, he explained that the current state of the market is just consumers visiting the methadone clinic, rather than the end of Bitcoin as a whole.

Even while he has an apparent vested interest in the future success of this decade-old industry, consumers would be remiss to cast aside Novo’s comments. Still, as is common investor practice, the Galaxy Digital CEO’s remarks should be somewhat taken with a grain of salt.

Regardless, the fact of the matter is that many industry insiders aren’t ready to fold, even while countless startups and ‘fairweather’ investors are nearing collapse.

The post Mike Novogratz Adamant That Bitcoin (BTC) Won’t Fall To $0 appeared first on Ethereum World News.

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Novogratz's Galaxy Digital Will Start Trading on a Stock Exchange This Week

Cryptocurrency merchant bank Galaxy Digital is set to trade on Toronto’s TSX Venture Exchange on August 1, Bloomberg reported Monday.

The cryptocurrency merchant bank, which was first announced in January, received final approval from Canadian regulators to begin trading, founder and billionaire investor Michael Novogratz told BNN Bloomberg Toronto. He called the process to receive permission “frustrating,” citing the time it took to receive this approval.

He added:

“If I knew what I know now, knew the crypto markets were going to swoon as much, and it was going to take so long, I might have stayed private for another year or so and then gone public. But I don’t think it’s a mistake.”

Galaxy Digital lost $134 million in the first quarter of 2018, largely due to declining cryptocurrency prices, the company announced in a quarterly earnings report last week, as CoinDesk previously reported.

The lengthy listing time came from the fact that  Galaxy Digital chose to undergo a reverse takeover by merging with a TSX-listed shell company. Regulators examined the deal closely, going so far as to push back the final approval for listing from April to August, according to Bloomberg.

That being said, Novogratz believes cryptocurrency prices will rebound, predicting that bitcoin’s price might soon see $10,000 again.

“I think we actually [are] in the bottom of the market. Part of this is the anticipation of an ETF that will hopefully get approved. If that ETF gets approved in a few weeks, we will go to $10,000. I don’t think we get through $10,000 cause there is a big ceiling over there,” he said.

Investors need more tools to trust the space before the price can go beyond $10,000, he said, explaining that “a lot of retailer investors got caught by bad prices last November and December.”

“I don’t think we will get through $10,000 until we get custody solutions announced implemented by trusted names,” he added.

At the time of writing, Bitcoin is trading around the $8,000 mark, according to CoinDesk’s Bitcoin Price Index.

Michael Novogratz mage via CoinDesk archives

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Novogratz’s Crypto Firm Incurs $134 Million In Q1 Losses

The cryptocurrency market hasn’t had the most successful start to 2018, with prices declining by over 60%, and speculative investors leaving the market en-masse. According to a press release relayed by Business Insider, the market’s misfortune has also impacted the operation of Mike Novogratz’s cryptocurrency-centric firm.

As per the financial statements of Q1 of 2018, Galaxy Digital lost approximately $134 million during the first fiscal quarter of this year. Diving deeper into the numbers, it has become apparent that the firm suffered due to declining cryptocurrency prices.

The New York-based merchant bank posted a net loss of approximately $103 million due to cryptocurrency trading, with $13.52 million in realized losses, and $85.5 million in unrealized losses. Galaxy also spent $10.9 million on operational expenses, putting the firm deeper into a financial hole.

The release of the financial statements was required to occur to fulfill Novogratz’s plan to list his firm on the Toronto Stock Exchange’s Venture branch in Canada. It is important to note that these numbers only apply to Q1 of 2018, with the firm not disclosing what was its financial situation in the prior three months (Q2). But if Novogratz receives approval to become publicly traded, it is likely that an in-depth look at the firm’s financial situation will be revealed in due time.

Novogratz, who is the founder and CEO of Galaxy Digital, issued a statement, noting that he was “very proud” of the firm’s progression since the start of the year. He then added:

We have assembled a world-class team with deep institutional knowledge and expertise and have also made significant strides in scaling our four core business lines.

Notwithstanding of the dismal figures, it seems that Novogratz hasn’t given up hope in the investment of crypto assets yet, with the balance sheet reporting that Galaxy held $225.8 million in digital assets as of March 31st. Additionally, the value of the unrealized losses indicates that the firm is likely looking to hold their crypto assets for a while longer.

Galaxy Digital Trudges Foward, Despite Heavy Losses

Despite nearly $134 million in total losses, Galaxy Digital has trudged forward in these choppy waters. As reported by Ethereum World News earlier this week, the cryptocurrency-focused firm recently made an investment into BlockFi. This investment into the cryptocurrency-fiat lending startup is now the 11th investment they have made in a third-party company, with these investments being valued at $86.8 million.

Novogratz contributed over $300 million of his personal fortune to get the firm off the ground, so it may be rather disappointing for the former Wall Street executive to see these heavy losses. However, the investment guru still holds faith in the cryptocurrency market, recently calling for the collective value of all crypto assets to reach $20 trillion in the future.

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Crypto Bank Galaxy Digital Loses $134 Million in Q1

Crypto investment bank Galaxy Digital lost $134 million in the first quarter of 2018, largely due to declining cryptocurrency prices, the company announced in a quarterly earnings report Wednesday.

Galaxy Digital, chaired by billionaire investor Michael Novogratz, said it saw a “net unrealized loss” of $85.5 million on digital assets, and a further $24 million loss on investments, totaling $109.6 million overall in its first-ever quarterly earnings report. The firm also spent $11 million in operating expenses and saw a $13.5 million loss from its income, resulting in roughly $134 million lost in the first quarter, according to the report.

The company only reported the results between January 1 and March 31, and has yet to reveal what its second quarter looked like.

The report confirmed Novogratz’s plan to complete a merger with Canadian companies First Coin Capital Corp. and Bradmer Pharmaceuticals Inc. Galaxy Digital is also still undergoing a process to have its shares listed on a Canadian stock exchange, Bloomberg reported.

Regulators have issued additional demands for the merger, resulting in a delay in getting its shares listed, Bloomberg wrote.

Despite the delay, Novogratz said in a statement that he was “proud” of the progress Galaxy Digital made so far in 2018.

He added:

“We have assembled a world-class team with deep institutional knowledge and expertise and have also made significant strides in scaling our four core business lines. I have complete confidence in our team’s ability to continue driving growth and believe the Company is strategically positioned to help further institutionalize the digital assets and blockchain technology industry.”

Michael Novogratz image by Brady Dale for CoinDesk

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AlphaPoint Raises $15 Million In First Major Funding Round

Crypto services company AlphaPoint successfully raised $15 million in its first major round of venture capital funding, the firm announced Thursday.

AlphaPoint raised the funds through Mike Novogratz’s Galaxy Digital, the self-described cryptocurrency merchant bank. Chief executive Salil Donde said Galaxy Digital managing director Greg Wasserman is also joining his firm’s advisory board to provide “oversight, guidance and insights.”

Donde told CoinDesk:

“Galaxy and AlphaPoint are both leaders in the crypto and blockchain space, so there have been, and will continue to be, opportunities where we can collaborate for the benefit of mutual customers. With respect to future products and technology, AlphaPoint will continue to incorporate the needs of our customers and our prospective customers in conjunction with the ever-changing blockchain landscape around us.”

The new funds will help AlphaPoint continue its mission of using blockchain technology to digitize assets in both traditional and emerging markets, he said, referencing the Regulated Asset Backed Token (RABT) his firm introduced to provide liquidity into the real estate market.

In a statement, Wasserman noted that “the market opportunity for digitizing illiquid assets is tremendous. Consumers are demanding increased access, transparency and trust. Businesses are seeking increased liquidity with reduced fraud, risk and cost.”

Galaxy Digital was launched earlier this year by billionaire and former hedge fund manager Michael Novogratz, and reportedly raised a total of $250 million as a cryptocurrency investment venture.

“We are in the early stages of a fundamental transformation in financial markets due to the digitization of assets … we are excited to partner with AlphaPoint as we continue to help drive this revolutionary change in digital markets,” he said in a press release.

Handshake image via Shutterstock. 

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Novogratz's 'Crypto-Bank' Is Backing Everipedia's Blockchain Pivot

Galaxy Digital, the crypto-asset merchant bank launched by former fund manager Mike Novogratz, has made its first major investment.

Everipedia, the decentralized offshoot of Wikipedia, announced Thursday that it had secured $30 million through an equity sale led by Galaxy Digital’s EOS.io Ecosystem Fund. The funding round was restricted to strategic investors, according to statements.

The startup plans to use the proceeds from this funding round to launch its peer-to-peer network, led in part by chief information officer and Wikipedia co-founder Larry Sanger.

Everipedia announced last year that it was moving to the EOS.io blockchain, with its newly-envisioned infrastructure being built on top of that network.

The company hopes to develop a censorship-proof system using smart contracts which record contributions while using a cryptocurrency token to reward its contributors, as CoinDesk previous reported. Sanger, who joined last December, said at the time that he joined the startup to be part of a system which is not controlled by a small number of individuals.

He said in a new statement:

“In the era of fake news and a general distrust in central entities like governments, corporations and the media the world stands to benefit enormously from a decentralized and uncensorable knowledge base.”

Galaxy Digital was announced and launched last month by Novogratz, who sees it as a full-service, digital assets bank, as previously reported by Coindesk. The company was set to launch a hedge fund supporting crypto-projects, but the move was reportedly canceled late last year.

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Mike Novogratz Nets $250 Million for New Crypto Investment Venture

Billionaire and former Wall Street fund trader Mike Novogratz has reportedly raised $250 million for his come-back – a cryptocurrency investment venture dubbed Galaxy Digital.

According to Bloomberg, the private placement will enable Novogratz’s new firm to trade and manage cryptocurrency assets and offer consultancy services to blockchain startups.

In addition, a report from Taiwan’s media outlet Economic Daily News revealed that Terry Gou, founder and CEO of Foxconn (HCM) is one of the participating investors with an $18 million placement in the round.

The reports also indicate that investors are in fact buying Galaxy Digital’s shares through a shell pharmaceutical company which will allow Novogratz’s firm to be listed on a Canadian stock exchange without disclosing its financials.

The news comes as a notable return of the high profile Wall Street trader, who left Fortress Investment Group in 2015 after the firm closed his $2 billion macro fund.

It also arrived just a month after Novogratz formally unveiled the plan of launching Galaxy Digital on Jan. 9. Yet the venture announced at the time it will not offer any services to U.S. residents.

Previously, Novogratz has become a notable figure in the cryptocurrency market as he had been outspokenly bullish about the price of bitcoin since as early as 2014. More recently, he also doubled down on his belief in October 2017 that bitcoin would end the year at $10,000.

Disclosure: CoinDesk is a subsidiary of Digital Currency Group, whose investors include HCM.

Bitcoin and US dollar image via CoinDesk’s archive

The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at news@coindesk.com.

Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.

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Mike Novogratz Unveils Plan for Cryptocurrency 'Merchant Bank'

Billionaire and ex-fund manager Mike Novogratz has unveiled the launch of a cryptocurrency “merchant bank.”

Novogratz, a former chief investment officer for Fortress, is behind Galaxy Digital, which according to a Jan. 9 announcements will constitute a “full service, digital assets merchant bank.” Described by some as a kind of “Goldman Sachs for crypto,” Bloomberg reports that the plan is to get the company listed on the TSX Venture Exchange and raise upwards of $200 million.

The venture will not offer any services to U.S. residents, according to the release.

While Novogratz’s group has a plan outlined for the future bank’s operations, as well as a partial list of Galaxy Digital’s management, the press release noted that the proposal was contingent on being accepted by the Canadian TSX Venture Exchange, all parties completing their due diligence inspecting company assets, and the formation of a board of directors independent of both Galaxy Digital and Bradmer.

The groups aim to finish their respective due diligence work before the end of the first quarter in 2018, according to statements.

Galaxy Digital was previously set to launch a cryptocurrency hedge fund before Novogratz moved to scuttle the launch in late December. At the time, he cited the challenges involved in managing clients’ cryptocurrencies in addition to his own portfolio and other conflicts of interest.

He also cited market conditions – bitcoin had fallen nearly 50 percent in the previous few days – according to a previous Bloomberg report.

Novogratz image via CoinDesk archives

The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at news@coindesk.com.