Billionaire Mike Novogratz remains bullish on crypto and hopes for a more crypto-friendly presidential administration.
No Fear Novogratz
Despite the Trump administration’s threats of new crypto regulations, Michael Novogratz, Galaxy Digital CEO, believes Bitcoin is remaining strong. He said the price rise of the past few days demonstrated the resilience of the bull market.
“They are throwing a lot at the system,” he told CNBC’s “Squawk Box.” “It’s not actually impacting it.”
Recently, Financial Crimes Enforcement Network (FinCEN), a division of the US Treasury, proposed disclosure rules for private wallets and financial institutions. The proposed regulation fights crime and money laundering revolving around cryptocurrency.
Though this was considered a threat, Bitcoin has continued to rise, reaching about ~$28,000 briefly on Dec 27, 2020. Likewise, fear of a crackdown may explain why so many are moving their crypto in cold storage wallets and off semi-regulated exchanges.
Under the new rules, independent crypto owners must identify themselves on transactions of more than $3,000. Platforms must report transactions of $10,000 or more.
Bad for business
Novogratz was nonchalant on “Squawk Box”. This style of regulation was a common approach of the Trump administration, he said. Novogratz also said that tightening regulation could send innovation and money out of the country.
He also hoped that the tune of the government would change when President-elect Biden takes office:
“I’m hoping, you know — we get a change of the guard in 20 days — I’m hoping we can get some more open-minded regulators.”
The billionaire is a frequent donator to Democratic politicians, CNBC reported.
Meanwhile, the Treasury Department has not yet implemented the new rules. It offered a 15-day comment period for the public to suggest changes. Novogratz and Coinbase both asked for more time.
The former hedge-fund manager also slighted Trump for the poor timing of the new rules, which could be reversed with a change in power:
“It’s kind of endemic of the Trump administration trying to jam in legislation, and quite frankly there are a lot of unintended consequences,” he said.
There has been a huge uptick in institutional investors recently, and Novogratz counts his clients among them. What’s more, retail investing seems to have fueled the epic holiday rise of Bitcoin’s price. Additionally, interest does not even seem as high as it was in 2017’s bull run.
Still Bullish on crypto
Despite the threat of legislation, the investor remains very bullish. In the past, Novogratz has said the new year will bring Bitcoin near to $60,000. He also believes less volatility will help attract larger investors.
The only downside, he said, is that technology could be stifled. Regulation and predictability could bring in money, but it could also encourage visionary developers to look elsewhere in the world to stretch their crypto muscles. What he’d love to see is a regulator who finds a happy medium:
“I would love an administration, I would love a regulatory framework that embraces that, not fights that.”