Former Fortress Principal Michael Novogratz left the firm's colossal macro hedge fund almost two years ago, but has been discussing investments in virtual currencies since 2013 when he told a UBS conference...
"Put a little money in Bitcoin...Come back in a few years and it’s going to be worth a lot."
He was of course correct, Bitcoin was trading around $200 at the time and as recently as three weeks ago was worth $5000...
The last time we heard from Novogratz was in June 2017, at the CB Insights Future of Fintech conference in New York, where he told attendees that he has cut holdings (in Bitcoin and Ethereum) after the cryptocurrencies' latest "spectacular run," warning that "Euthereum had likely hit its highs for the year," and "cryptocurrencies were likely the biggest bubble of his lifetime."
However, while this all sounded desperately downbeat, Novogratz was still very "positively constructive" on the space overall. He should be - he has 20% of his net worth invested in the sector... and now, as Bloomberg reports, Mike Novogratz is reinventing himself as the king of bitcoin.
Novogratz has had a very good run. Aside from his epic call in Bitcoin, he has done extremely well in Ethereum, as Bloomberg details...It started with a late-2015 visit to a friend’s startup in Brooklyn.
“I expected to see Joe, a dog and one assistant. Instead I saw 30 dynamic young people crammed in a Bushwick warehouse, coding, talking on the phone, making plans for this revolution,” Novogratz said.
“Macro guys are instinctive. My instinct was, ‘I want to buy a chunk of this company.”
He decided instead to invest in ether, the cryptocurrency token used on the Ethereum network.
Novogratz bought about $500,000 at less than a dollar per ether and left on a vacation to India. By the time he returned a few weeks later, the price had risen more than fivefold. He bought more.
Over the course of 2016 and into 2017, as ether surged to almost $400 and bitcoin topped $2,500, Novogratz sold enough to make about $250 million, the biggest haul of any single trade in his career.
He said he paid tax on the profits, bought a Gulfstream G550 jet and donated an equal amount to a philanthropic project for criminal justice reform.
Novogratz was hooked, and according to a person familiar with his plans, Bloomberg reports that the outspoken macro manager is starting a $500 million hedge fund to invest in cryptocurrencies, initial coin offerings and related companies. Novogratz will put up $150 million of his own money and plans to raise $350 million more by January, mainly from family offices, wealthy individuals and fellow hedge fund managers.
“This is going to be the largest bubble of our lifetimes,” Novogratz said.
“Prices are going to get way ahead of where they should be. You can make a whole lot of money on the way up, and we plan on it.”
At that size, the Galaxy Digital Assets Fund would be the biggest of its kind and signal a growing acceptance of cryptocurrencies such as bitcoin and ether as legitimate investments.
Where others see volatility and liability, Novogratz, a former Goldman Sachs partner, smells opportunity.
“In a lot of ways, this is a market like any other market,” Novogratz said.
“You see the psychology of fear and greed in the charts the same way you’d see it in charts of the Indonesian rupiah or dollar-yen or Treasuries. They’re exaggerated because of less liquidity and because you can’t get short.”
“I sold at $5,000 or $4,980,” he said.
“Then three weeks later I’m trying to buy it in the low $3,000s. If you’re good at that and you’re a trading junkie, it’s a lot of fun.”
And bubble or not, "Novo" as his friends call him, concluded eloquently on the extreme nature of cryptocurrencies' potential...
“Remember, bubbles happen around things that fundamentally change the way we live,” he said.
“The railroad bubble. Railroads really fundamentally changed the way we lived. The internet bubble changed the way we live. When I look forward five, 10 years, the possibilities really get your animal spirits going.”






Good chance you will be a spirit within 10 years
For every person who makes a whole lot of money there is a whole lot of people who lose their shirts
There are a lot of crypto bashers on this site that cant see passed their own bias.
Interesting technology, but it's a spec bubble right now based on what it *might* do one day.
As soon as I saw Amazon, I knew brick and mortar retail was dead/changed forever.
That was 2002/3. It took 15 years for that to start to happen, but it's finally happening. Brick and mortar retail as we knew it growing up is dead. It will still exist in some form, but the way we knew it is dead.
Same thing with crypto - it may take 15-20 years for the real change to come, but it will come. And it's a change to a lot of stuff - not just money and banking, but investments in companies will be on the blockchain, the internet will be decentralized, not hosted in server farms owned by Google and AWS. Title to cars and real estate will be on blockchain.
Crypto is a speculative bubble based on the current usage, but *IF* the technology and usage does come around, it's way, way, way under capitalized.
This one won't take more than a few years to unfold, it won't take any 15 years. Watch for the "spend" when there is actual real usage of the coins. That's when it's real.
This one won't take more than a few years to unfold, it won't take any 15 years. Watch for the "spend" when there is actual real usage of the coins. That's when it's real.
The blockchain will disintermediate the entire global financial system and we will see significant disruption in 3-5 years maybe sooner.
There was a WSJ article recently that stated that AI will cause 30% of Wall Street to be laid off in 3 years. They were right about the layoffs but it won't be AI but the blockchain and smart contracts.
I have recruiters still trying to get me back in the legacy finance industry but I have no interest in institutionalized fraud that creates NOTHING (except Ponzi schemes). My last boss made over $250k per year. I could write a smart contract on a blockchain that would eliminate his job completely and make his reports more accurate and more timely.
As soon as I saw Amazon, I knew brick and mortar retail was dead/changed forever.
Beg to differ. It's a dialectic. Right now, online has it all but within that dynamic are the seeds of its own limitations. People (especially Millenials) are social by nature as well as experiential. I guarantee you what is out there somewhere is a physical marketing concept that will make someone a fortune. The same demographic that is MUCH more desirous of groups/experiences is not going to just be content staring into a screen by themselves. There will be another cycle and it will be, if not bricks and mortar, some more energy efficient and cost effective physical plant where people congregate.
"There are a lot of crypto bashers on this site that cant see passed their own bias."
Tangible, sustainable assets, in preparation for what's about to hit us all, at the most fundamental level of life..
Past
nvm
SON: "Dad, how do you make a fortune?"
DAD: "You've got to be bold and you've got to be right."
SON: "What if you are bold and you are wrong?"
DAD: "Then you go down with the ship."
Kudos if you know what book that is from.
Berenstain Bears?
https://twitter.com/mombot/status/879420623352504320?lang=en
You know how you can mine spiritcoins™ and transfer them straight Heaven? "..go, sell your possessions and give to the poor, and you will have treasure(spiritcoins™) in heaven. Then come, follow me"
In a few short years or months after that you will become a spirit, eat your stash of spiritcoins™ and follow JC
"he was of course correct"
Hindsight is 20/20
Were only in the top of the 2nd Inning here.. This mutha fucker is gonna go higher and higher then anyone can ever dream..
Then there's Gold. Already gettin' nigga fucked by Da Boyz. If was ever a fraud, its GOLD!
Just wait until TPTB release 'paper' bitcoins, then prepare to have it manipulated like one of the oldest forms of currency in world history has been by naked selling on a massive scale by central banks and the swamp.
You forgot the /s.
Jamie Dimon has already started manipulating cryptos. Every bank has a research department working on crypto projects. They know they will be disintermediated soon and want to create their own blockchains.
The joke is on them. If I use cryptos that are open-source and trustworthy why would I want to use a centralized crypto from banker scum land? Maybe they will play amongst themselves with their bitfiat on their private islands. The rest of us will just ignore them.
It's a spectacular bubble, but you should invest in it.
BECAUSE I AM ONE OF THE CRYPTO MANIPULATORS MOVING THE MARKET ANY TIME I WISH. SO I can take your cash and make it mine.
The purpose of anyone running an investment fund is to take your money and make it theirs. Always has been and always will be.
You missed the point every market when it's new and life changeing can start off with huge bubbles. The thing is Bitcoin hasn't even taken off yet just wait till the world actually starts to use it to transfer mass amounts of money. It would not hurt to buy a small amount just saying
This guy is so full of shit it makes my head spin. If he bought $500k of ETH in late 2015 wheres the volume?
When you make your own reality, why let the facts get in the way.
Easily done with orders spread out over several days.
Or it could have been a private sale.
.
So is this the inventor of the FUCK coin?
Good pitch man.
Get some gold tho'
Physical one. Will be in short supply when 9 billion people ask for money
Here we go with the survivorship bias again.
Yup. Got to educate ur fellow president if u ask me
Take it out of the ether and turn it into barbarian relic.
Every Squirrel gets lucky and finds at least one nut in his lifetime.
some nut.
5, 4, 3, 2, 1...
Here come the 'oldbugs' to trash Bitcoin again.
What are you? Tmosely's illegimate child?
I knew there was something good about today. I haven't seen Tmosely on any threads today.
One guy buying private jets and building hedge funds changes the way all other people live?
Well, I dunno, but I can tell you that even with the relatively small amount I invested last year and early this year, I made terrific profits when people in the stock market were switching from steak to beans.
Everything in life is a risk. Walking down the street is a risk. My approach is to never have so much in it that I would be wounded if it went to hell. Other than that, I intend to keep playing the game, since it appears to be the only game in town that the CB's can not control.
Yes, but investments shouldn't be a pure gamble and it is tough to argue that cybercurrencies are anything but gambling by another name. At least when you go to Las Vegas, you understand what the odds are.
Ever think the Central Banks couldn't buy a lot of Bitcoins, etc. over time and then sell all at once, creating a panic and dropping the price by 75%?
Traders and trading are not investing, the best traders are not gamblers either; but sometimes a small bet as a percentage of your capital can be worth it if the return is big enough.
I put a small amount in crypto it has paid off bigly. Glad I took a very small risk my only regret is I didn't go all in haha.
"Ever think the Central Banks couldn't buy a lot of Bitcoins, etc. over time and then sell all at once, creating a panic and dropping the price by 75%?"
You realize they already do this with stocks, bonds, and gold, right?
There is that and then on the other paw, there is this:
"The less you bet, the more you lose, when you win. BET BIG!
The dif between Novogratz becoming a billionaire, and us becoming a thousandaire.
So how do you become a Frigidaire?
> I saw 30 dynamic young people crammed in a Bushwick warehouse, coding, talking on the phone
Sounds like Enron, people making fake phone calls pretending to make trades.
How's all the Bitcoin buyers the ex Goldman trader (theres that name a again) sold at $5000 doing today ???
This is the kinda story that brings me to my knee.
I wouldn't waste your time, he won't be giving you a damn thing, you know, for the effort...
O.K.
Both knees.
Hehehe...I will let you have my terrible towel that I no longer need for the clean up.