Crypto investor Mike Novogratz told CNBC on Tuesday that bitcoin faces near-term uncertainty after falling below $30,000, but he maintained a long-term positive outlook.
Bitcoin has struggled in the past two months, after notching an all-time high in April near $65,000. The weakness in recent days comes as reports indicated China took further steps to restrict bitcoin mining in the country, and as the nation's central bank put pressure on financial firms to limit crypto-related service offerings.
"The ecosystem is so much more mature. The amount of players that are moving in are so much more mature. Every single bank is working on their own crypto project, how they can get bitcoin to their wealth clients," Novogratz said. "I think a lot of clients that didn't buy it the first time will see this as an opportunity to buy it and get involved."
Some crypto trading platforms in Asia have allowed large leverage ratios up to 100-to-1, for example, Novogratz noted. The Chinese government's crackdown on that kind leverage is a long-term positive, he said. "Maybe not in the short run, but it's a good thing," he added. "That's what's created this excessive volatility that we've seen."
"We'll see if it holds on the day. We might plunge below it for a while and close above it," Novogratz said, referring to the $30,000 price level, which some technical analysts saw as a key support level for bitcoin.
"If it's really breached, $25,000 is the next big level of support. Listen, I'm less happy than I was at $60,000, but I'm not nervous," added Novogratz, founder and CEO of Galaxy Digital, a crypto-focused financial services firm.
Bitcoin on Tuesday was down more than 50% from its April all-time high. The cryptocurrency has had bigger drawdowns before, like when it ran up to a then-record high near $20,000 in December 2017 and then lost more than 80% of its value, sinking below $3,500 per token.
Billionaire bitcoin bull Mike Novogratz said Wednesday that the cryptocurrency industry remains in its early days, as he predicted the wealth it generates will continue to proliferate in the years ahead.
"Right now, total crypto wealth is roughly $2 trillion, so that's one half of 1% of all wealth," Novogratz said on CNBC's "Squawk Box." "If you don't think in the next two to three years that can be 2% to 3%, you're not paying attention to the trends."
The crypto marketplace is again to primary value swings adopted by means of a Bitcoin (BTC) value crash on Tuesday, the day the biggest cryptocurrency turned into criminal mushy in El Salvador. However it was once no longer surprising for lots of crypto veterans, together with Galaxy Virtual CEO Mike Novogratz.
Novogratz's comments Wednesday came ahead of the blockbuster market debut of Coinbase, which is the largest crypto exchange in the U.S. Bitcoin set a new record high of almost $65,000 earlier in the day. Ether, the world's second-largest crypto currency by market value, also was rallying.
Novogratz said he wasn't too concerned with how shares of Coinbase traded during its Nasdaq debut. The stock opened at $381 a share, well ahead of the reference price of $250.
"Let's not miss the big picture: This is like the Netscape moment for the cryptocurrency economy. Remember, Netscape in 1995 — four years before we had this crazy frenzy — basically signaled the beginning of the internet age," Novogratz said.
"This is a really important day for the whole crypto world. This is saying, this is an asset class and it's an asset class that's here to stay," he added. "And so, listen, it's somewhat irrelevant where Coinbase trades today."
What is internet of value?
The Internet of Value, described in simple terms, is an online space where people can instantly transfer value between each other, eliminating the need for the middlemen and most costs. Theoretically, anything of monetary or social value can be transferred between parties, including currency, assets, stocks, securities, intellectual property rights, scientific discoveries, and even a vote in an election.
Transferring value is already supported by legacy financial rails like SWIFT, blockchain like Bitcoin or Ethereum and new and emerging technologies or solutions like Interledger (ILP), PayID and many, many apps that make transferring value easier with existing infrastructure. All of these need to be connected somehow to achieve the vision and there are likely still a lot of unknowns.
The Internet of Value sounds similar to the Internet of Things (IoT), which is a different concept but they do not necessarily exclude each other. On the Internet of Things any device can communicate with other devices, which forms a complex network that can produce more diverse results than human-human or human-computer interaction. IoT is interesting in this respect as the devices in this network might potentially want to exchange value too and that is why these two will likely evolve in parallel.