CEO of Galaxy Digital Mike Novogratz says Bitcoin’s market cap can “easily” surpass gold in the next 20 years.
In a recent interview with Anthony Pompliano, the Wall Street veteran says it’s a matter of time before institutional players like Goldman Sachs and Intercontinental Exchange enter the crypto space.
— Pomp ? (@APompliano) March 20, 2019
Novogratz said that he knows Goldman Sachs, for instance, is building a framework for securities tokens. He commented: “They’re not doing anything yet, but they’re getting really ready.”
The hedge fund mogul said that Goldman Sachs was looking to answer questions like: “Where would you store them? Do you have to build your own custody, or can you use someone else’s custody?”
Whilst the Galaxy Digital CEO did say that “the regulatory framework isn’t there yet on security tokens”, he claims his team is “working really hard on our security token business”.
Still bullish on Bitcoin
According to Novogratz, Bitcoin’s upside potential remains strong, and long-term investors would still be smart to allocate a small percentage of BTC in their portfolio.
He said: “I think the macro case for Bitcoin is pretty strong. And so, if you can put a couple of per cent of your portfolio in, there’s a decent chance it catches wind.
“Fidelity is just getting set up, Bakkt continues to get delayed a little bit, but it’s not going to be delayed forever. They’re going to be in the game. And there are lots of other players coming.”
Overtaking gold in 20 years
Commenting on the much-loved store of value, Novogratz said: “Gold’s got a $7.5 trillion market cap, and we’re 100x off on that. We’re not going to get there in Bitcoin in the next year or two. But over a 20-year period, that could happen easily – and that’s giving zero optionality to all the other stuff, so I think it seems like a pretty smart portfolio bet.”
Talking about the recent CBOE Bitcoin future delisting, he said: “The reality is, the CME kicked their butts. And these guys have limited resources on what they’re going to spend their focus on, and they decided to spend it elsewhere. Finding leverage in Bitcoin is going to get easier as the architecture in the space gets better.”
On going short, the hedge fund chief said: “You can already see the lending market around Bitcoin went from 10% to like 3%. So once you can borrow you can short. And so now it’s not so hard to short Bitcoin. It used to be almost impossible to short Bitcoin in 2016… It wasn’t great, but it’s not critical.”