Long Term Bitcoin Believer Novogratz: Starting A Crypto Business In This Market ‘Sucks’ Right Now
The current state of the virtual currency market is not inspiring confidence among investors. Indeed, Michael Novogratz said that it is very difficult to start a crypto business in this bear market. Although he remains confident about the future of the space, he expressed dissatisfaction with the bear trend affecting the crypto space.
During a conversation with the Financial Times, the founder of Galaxy Digital, said that the crypto-enterprise he started has to deal with different challenges that are not present in the traditional banking industry.
Galaxy Digital was launched back in 2017 and received $302 million dollars in investments from Novogratz. Currently, it has offices in London, Hong Kong and Tokyo. Furthermore, the company is also handling around $460 million dollars in assets.
However, the company is not experiencing a very good situation. It is following the current bear trend of the industry. Cryptocurrencies have been falling since the beginning of the year, and Bitcoin has reached yearly lows on November 25. Because of this situation, the firm’s shares dropped 37 per cent since it entered the market on the Toronto Venture Exchange.
During the first quarter, the company registered losses of $134 million dollars. It has also registered trading losses of $13.5 million dollars. During the second quarter, the situation changed. It registered $35 million in net income and reduced trading losses to $1.4 million.
Talking about the situation, Novogratz commented:
“2017 was just fun, it was almost stupid. [But] this year has been challenging. It sucks to build a business in a bear market… [Staff] anxiety levels go up when crypto goes down… In most traditional business, [such as] Goldman Sachs, you don’t worry. There’s not an existential threat out there.”
Novogratz has always been commenting about the crypto market giving his opinion about Bitcoin and other projects. He has experience in the financial industry and he is very positive about the future of the crypto space.
According to sources quoted by the Financial Times, the company’s advisory business received a subpoena from regulators in the United States. Nevertheless, this has never been confirmed by Galaxy Digital.
According to Mr. Novogratz, institutional investors would help the market grow in the near future. There are some companies that are ready to release their institutional products and platforms for institutions and traditional investors to enter the market.