Crypto Facing A "Crisis Of Confidence" But Bitcoin "Is Not Going Away": Mike Novogratz
Last week crypto investor Mike Novogratz took to CNBC in an attempt to help analyze the fallout from the FTX scandal. Speaking to Aaron Ross Sorkin, Novogratz - who suffered major losses (and humiliation himself) when Terra/Luna collapsed - laid out how trust has been lost in the asset class for the time being.
"This is about transparency and disclosure in a lot of ways. Our industry has failed to self-regulate. I think the money side of crypto, companies like ours, are going to get regulated and should be," he says to start the interview.
"The tech side of crypto, the on-chain stuff, that has its own series of regulatory challenges. But that should be kept separately. Right now we're in a deficit of trust - people think there's a black swan around every corner," he continues.
"Isn't this an indictment of crypto? The entire premise of crypto was to create trust," Aaron Ross Sorkin asks.
"That still is the long-term goal. Why did companies like mine get set up? We are a bridge company to bridge people into this new economy. It accelerates the capital going in, it helps people understand it. All the capital that has moved into crypto has come from centralized companies. But just like a centralized company, they need to build trust..." Novogratz says.
"This is not really an indictment of crypto, its an indictment of FTX and other companies that were poorly run or fraudulently run," he continues.
"Do you feel like investors are going to take advantage of any crisis of confidence. Do we have a crisis of confidence in this market?"
"We certainly do have a crisis of confidence in the industry and we're not out of the woods yet. FTX was a major player so it's going to take a few weeks for people to even get their balance back. Bitcoin's not going away," he concludes.
"I don't think it's going to be a 'v' recovery, it's going to be a grind out of gaining trust."
You can watch Novogratz's full interview on CNBC here.
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