Multi-Billion Dollar Endowments Betting on Bitcoin, Says Crypto Titan Mike Novogratz

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The CEO of crypto investment bank Galaxy Digital says institutions are starting to place their bets on Bitcoin.

In a new interview with Bloomberg TV, Mike Novogratz says three of the biggest endowments in the US have invested in crypto funds.

“The institutions who are making longer-term decisions are making sure they’ve got proper custody, making sure their ducks are lined up. And they’re slowly and steadily moving in. Most of the big endowments in the United States have already made their first bet in Bitcoin. That’s the Yale endowment, the Stanford endowment, Pennsylvania. Usually, they’re leaders. You’re going to see pension funds next.

And as more and more people get access to be able to buy Bitcoin when it’s on platforms like TD Ameritrade or Fidelity, you’re going to see a much quicker price move.”

Endowments have been quiet about their investments in Bitcoin and cryptocurrency. Harvard University, which has the biggest endowment in the US at $36 billion, is the only investor on the record. It also has a stake in Blockstack’s crypto token sale, conducted earlier this year.

Novogratz says he believes Bitcoin has outperformed the overall crypto market in 2019 because it has established a strong use case as a digital store of value, while many altcoins are still proving their worth.

“Where I think all the other cryptocurrencies – and why they’re not doing as well – is people are waiting to see, does an economy grow around them? Are they used? We buy on dips and we sell a little bit every time it rallies, but we have a big core exposure that we’re holding onto…

Put this in perspective. Ethereum is four years old. What I think 2017 did, that crazy bull market, is it gave people unrealistic expectations on how fast the blockchain revolution, the crypto revolution, is actually going to happen. Bitcoin itself found a niche case and that’s why it’s outperforming, and why I think it will continue to outperform. It’s kind of a finished product, but the rest of the crypto revolution is five or six years away from really impacting your everyday life.”

As for where the price of Bitcoin is heading, Novogratz says he thinks BTC is consolidating before another move to the upside.

“Put it in perspective. Bitcoin started the year at $3,800, traded at $3,500 and now it’s at $10,200. It’s up 200-odd percent already. It’s had a huge run. I think this is a bit of consolidation. It’s traded well given that the rest of cryptocurrencies haven’t done as well. So Bitcoin’s way outperformed cryptocurrencies and it’s holding its own. My sense is it’s getting ready for the next leg up.”

Novogratz says regulators in the US are taking their time with crypto and will slowly realize that crypto and blockchain technology is already part of the financial infrastructure.

“Here in the US, everyone’s waiting on the SEC for either an ETF or a Bitcoin mutual fund. We’re trying to move ahead with a Bitcoin mutual fund. We’re just in queue waiting for Jay Clayton to get more comfortable. I think if Canada goes first, they’re going to win a lot of business. I understand why the regulators are cautious, but the cow is out of the barn. Bitcoin’s got a $200 billion market cap or a $180 billion market cap already. You’ve got giant institutions that are participating in it. So this is not like a backwater experiment anymore. This is part of the financial infrastructure. It’s time for the regulators to catch up.”

You can check out the full interview here.

Regulation and Society adoption


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