Billionaire Mike Novogratz says dogecoin will falter because no institutions are buying it and retail investors will lose interest | Currency News | Financial and Business News

GettyImages 1281542990
Mike Novogratz.

Dogecoin is a temporary fad that’s likely to lose momentum because institutions aren’t investing in it, Mike Novogratz told Goldman Sachs in a recent interview.

“It likely doesn’t have long-term legs because no institution is buying it and at some point, retail will lose interest,” he said.

The meme-inspired cryptocurrency has surged in popularity so far this year for two reasons, according to the Galaxy Digital CEO.

“First and foremost is tribalism in the investing community,” the billionaire investor said. “It’s the same thing we saw with the rise in GameStop, which was driven by a young community of investors who have been empowered as financial players through trading apps and social media platforms.”

“Second, value is showing up in new places because the government is printing a lot of money. It’s important to keep that in mind when thinking about some crypto assets and equities like GameStop that have short-term potential but no long-term viability.”

Novogratz is bullish on cryptocurrencies in general, but is less excited about dogecoin – unlike billionaire Mark Cuban. The “Shark Tank” investor recently said he owns 3,250 dogecoins, and expects it to become a valid payment mechanism if enough people allow it to mature to that point.

But Novogratz thinks dogecoin is even more speculative than bitcoin, where the biggest risk is the Federal Reserve stops pumping liquidity into markets and eliminates the need for an alternative store of value.

“People still make stubborn arguments against [bitcoin], but every single bank we know of is building a wealth channel for crypto, 14 entities have bitcoin ETFs in line at the SEC, and most tech companies are building bitcoin into their wallet and interface,” he said. “To think we’re going to have less people believing in bitcoin isn’t logical.”

The billionaire investor acknowledged that many retail investors are buying bitcoin and other cryptocurrencies solely because their prices have been rising. But he said all great fortunes have been based on trends.

“I learned that from Paul Tudor Jones thirty years ago and Jeff Bezos and Bill Gates are proof points to this as well,” he said. “Bitcoin adoption and the macro factors behind it are a mega bull trend.”

Dogecoin was last trading 6% higher on Monday at 33 cents, and is up around 6,000% year-to-date.

Read More: eToro’s most popular female investor says she’s holding onto crypto stock and prefers Ethereum to bitcoin. She reveals the strategy that led 20,000 people to copy her portfolio.

Read Full Article


Latest articles

Related articles

Leave a reply

Please enter your comment!
Please enter your name here