Crypto Tycoon Novogratz: The "Speculative Era" of Cryptocurrency May Be Over

Mike Novogratz, founder and CEO of Galaxy, stated at a digital finance forum on Tuesday that the recent plunge in bitcoin is not caused by a single event, but rather reflects a broader shift within the entire industry.

Novogratz said that in November 2022, bitcoin dropped 22% in less than a day after the FTX collapse, which resulted in a "crisis of trust." He said, "This time, there is no concrete evidence. You look around and wonder: what exactly happened?"

Novogratz does consider the catastrophic event in October 2025 as a significant moment. At that time, over 1.6 million traders collectively lost $19.37 billion in leveraged positions within 24 hours, a situation he described as "wiping out a large number of retail investors and market makers," bringing enormous pressure on bitcoin's price.

"The core of cryptocurrency is about narrative, about the story," he said. "These stories take time to build, they take time to attract people to participate… so when a lot of people suffer heavy losses, the story doesn't recover immediately," he added.

However, Novogratz also sees more lasting effects and expects the current downturn to bring about some changes. He stated that as the crypto industry introduces "institutions with different risk tolerance," the recent "era of speculation" in crypto investment will gradually come to an end.

"Retail investors didn't enter the crypto space for an 11% annualized return," he said, "they came for a 30x, 8x, or even 10x return."

Novogratz stated that there will always be some traders speculating, but overall, "we will use the same channels—the crypto channels—to bring banking and financial services to the entire world, thereby changing or replacing the existing financial system. Therefore, the ultimate assets will be real-world assets, but the returns will be much lower."

He also pointed out that tokenized stocks will have "different return characteristics."

Editor: Yu Jian SF069