The cryptocurrency market returned to significant price swings, followed by a price crash on Tuesday, the day the largest cryptocurrency became legal tender in El Salvador. But that didn’t come as a surprise to many cryptocurrency veterans, including Galaxy Digital CEO Mike Novogratz.
Speaking with Bloomberg, the billionaire said cryptocurrency is still dominated by retail investors who are “too excited” by recent interest from organizations such as Visa and Amazon.
People understand that “cryptocurrency is not just bitcoin, which is bought to protect against the bad monetary policy,” he said. “But maybe, more importantly, it’s Web 3.0. This is the Internet of transmission of values ”.
Retail investors have used leverage for too long for a good reason, according to Novogratz, noting recent news of crypto-friendly relations from financial and retail giants like Visa buying intangible tokens and describing them as a promising medium; Walmart’s ambition to become a leader in crypto products; and job postings from Amazon for crypto experts.
“There is a realization that this is a promising technology, and no investor wants to miss the next Internet. This is the next Internet.”
Novogratz said investors were overwhelmed by emotion and the September 7 price drop was “a little bit of air from a hot air balloon.”
As his company Galaxy Digital plans to complete the acquisition of BitGo, the infrastructure provider for El Salvador’s official bitcoin wallet, Novogratz also commented on the Chivo wallet’s failed launch.
The Chivo government wallet has experienced server capacity errors, but Novogratz believes the technical issues will be resolved over time. He said the real question is how the system will work in six or 12 weeks, adding that it is not easy to implement such large-scale projects.
Novogratz’s comments are in line with the views of several analysts who have pointed to traders with an excessively leveraged environment after the Bitcoin price crash. The largest cryptocurrency plummeted to $ 43,000 on September 7, liquidating over $ 3.54 billion in derivatives markets. At the time of publication, BTC hovers around $ 45,000.