Crypto billionaire Mike Novogratz said the “crisis of confidence” in the digital asset world will drive more cryptocurrency users to seek out institutional players like Fidelity Investments.
(Bloomberg) — Crypto billionaire Mike Novogratz said the “crisis of confidence” in the digital asset world will drive more cryptocurrency users to seek out institutional players like Fidelity Investments.
The founder of Galaxy Digital Holdings Ltd., a crypto financial services firm, told CNBC that more people will put their money in “safe and trusted custodians.”
“The big winners in this are going to be people like Fidelity who have just come out with their crypto product,” said Novogratz.
He previously touted Fidelity’s involvement in the industry in September when Bitcoin had lost about half its value. The largest digital currency is now down 65% so far this year.
He added that he sees a buying opportunity for crypto in the long run, but it will take the industry time to rebuild trust.
Galaxy Digital previously revealed a $76.8 million exposure to FTX.com.
Other crypto-related firms have made similar disclosures amid the exchange’s unraveling.
Sam Bankman-Fried’s FTX empire filed for bankruptcy on Nov. 11. Court papers have shown that FTX-linked entities owed their 50 biggest unsecured creditors more than $3 billion.
“We certainly have a crisis of confidence in this market,” Novogratz told CNBC.
“We’re not out of the woods yet.”
The FTX collapse adds to a growing tally of scandals to roil the crypto industry in recent months. Earlier this year, the TerraUSD meltdown put the focus on Novogratz, who had backed Terraform Labs, the company behind Terra and Luna.
In the aftermath, Novogratz called it a “big idea that failed.”
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