Economics

Michael Novogratz: Investing In Cryptocurrency And Predicting Its Future

An interview and Q&A with hedge fund manager and founder of cryptocurrency investment firm Galaxy Digital Assets Fund, Michael Novogratz. In this interview, Michael discusses why he invests in, and converted to, cryptocurrencies and how its value will increase. Michael also talks about the future of cryptocurrency and how they can disrupt industries.

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Billionaire Michael Novogratz

Billionaire Michael Novogratz: Investing In Cryptocurrency And Predicting Its Future

Transcript

So I don't think it's a stretch for me to guess Mike that you would have voted for a on that list. You know I would have been a minus.

To be fair. I I see this crypto revolution as Internet3.0 I mean the Internet really did change everything about the way we live. And I do think in 15 years we'll look back in the block chamber which changed a ton. Is it better than the internet. No but it's going to be pretty darn big.

A lot of crypto evangelism sounds like nonsense to traditional investors.

You were and you are still a dyed in the wool mackerel guy right.

You worked at Goldman. You worked at Fortress. How did you make the journey from Wall Street punter to true believer. Help people along that road.

Sure. So crypto was a perfect asset to start with for a macro trader. It's a story macro traders love stories they love charge they have a momentum and they like to try to think they can see the future. And so when I first stumbled on crypto which was when 2000 the 12 still a fortress is still at Fortress right in the middle of the European financial crises four years after the the big financial crises. I looked at it I was like what at that point if you remember we have real serious investors thinking that hyperinflation was on the way. I remember Paul Singer from Elliott and investors one of the great greats was wanting to put Ben Bernanke in jail for treason because he really thought he was going to inflate away the value of the dollar. Think about that for a second. And so you have this sense of nervousness around fiat currencies you had this sense of distrust amongst the central banks and quite frankly the financial institutions in 2008 than we thought JP Morgan was going out of business. Lehman was Gallien didn't go out of business. And so it felt like an easy play in that there was this amazing new technology and there was a story that we could have a distributed trust you wouldn't need to trust the center. And so I saw libertarians anarchists cypherpunks and the people that were read about inflation all deciding this would be you know a new a new asset. And so I just originally bought at the spectacle of little go higher. I bought it for the money we bought it it was 96 Bucks Peercoin and it went up to a thousand pretty quick and that was pretty cool. It took a little while for me to dig in and really understand why it's going to be a lot bigger than a speculative as well.

And that raises an important question. There are people here so they might have heard a little bit about you've had to say about bitcoin already and Krypto more broadly in block chain but they know where you come from. Right. They know your background they understand your financial DNA. If it were as it were. Do you really then I'll use that term again. Do you really understand how it all works.

Yeah I'm getting close to really understanding it. So there's an there's three parts of understanding. So what's unique about Satoshi is break through his white paper. It's almost two different Nobel prizes. One of his computer science creating this idea of a distributed trust ledger a block chain itself. The computer science there is really advanced. And right now one of the problems in block chain is the block chains are fast enough. They haven't scaled fast enough and as you get more people into this distributed system it actually slows it down. And so there's all kinds of brilliant computer scientist working on fixing that scaling issue. There are a hundred different block chains out there with 100 different ways that they're going to fix the scaling issue. Part of my thesis is that the assumption that they're going to fix it and I don't get that just willy nilly. I was learning just at Princeton talking to the head of Computer Science there in so many of the talented graduates are going into the block chain. You know all across the world you're sucking in this town.