Mike Novogratz discussed the crypto revolution in his latest interview.

Mike Novogratz believes that trading cryptos successful requires both macro skills and boldness.

“It’s macro plus being an adventure guy” said Mike Novogratz as he talked enthusiastically about cryptos. “So the skills that you have in macro are so transferable” said Mike Novogratz sporting a pair of pink funky trousers, dual-colored sneakers, and a Galaxy sweatshirt all for that futuristic look.

“It is fascinating from a political perspective, fascinating from a phycological perspective, it is making new economic models and it is macro” he added.

“Mike Novogratz believes that trading cryptos successful requires both macro skills and boldness”

RAY DALIO

Mike Novogratz discussed the crypto revolution by recalling Paul Singer, an American billionaire hedge fund manager tearing apart Ben Bernanke over his quantitative easing QE policy

“I remember literally, Paul Singer took out an ad in the newspaper saying that Ben Bernanke should go to jail because QE2 was treasonous” said Mike Novogratz.

Mike Novogratz discussed the crypto revolution as a game-changer

“We have rational economic actors worried about the state of fiat currency, we also have the cypherpunks the libertarians, the people who want to live off the grid,” he said.

“So there was enough constituency to think cool technology, cool economic idea, this thing is going higher at least there will be a bubble,” he added.

“I had no idea whether there would be mass adoption, I bought it as a speculative asset and then we had the great debate do you want to own the asset or the picks and shovels?”

“I remember literally, Paul Singer took out an ad in the newspaper saying that Ben Bernanke should go to jail because QE2 was treasonous”

MIKE NOVOGRATZ

Mike Novogratz then bought some exchanges and invested Fortress and Benchmark.

“We invested in Bitstamp, and Corbett, and some other exchanges that did very well,” said Mike Novogratz.

Mike Novogratz discussed the crypto revolution as a type of insurrection against centralized systems

“These guys are plotting a revolution to take down all these centralized systems. They have a very clear sense of where they were going,” said Mike Novogratz.

So it is not just about currency, it’s about the cloud, ride-sharing, file sharing and all the verticals they had,” he said. It is about taking power away from the middle guy, peer to peer business.

So Mike Novogratz discussed the crypto revolution with its crux being distrust of centralized systems

“At the core it is distrust. And it is more of a utopian-they want to build a fair system,” he said.

“There is a whole social thing about it and it is not just about finance,” added Mike Novogratz.

So I bought a bunch of Ethereum at $0.96 and by the time I came back traveling from India it was 4$ then $5” – Mike Novogratz

Mike Novogratz discussed the crypto revolution in terms of an incentivized social network

“Can communities nurture and grow businesses or systems as well better than individuals” he said. “It is a huge experiment” he added.

“So I bought a bunch of Ethereum at $0.96 and by the time I came back traveling from India it was 4$ then $5” he said.

“This was going to be more than just financial it is going to be web 3.0” he added.

The danger of privately owned centralized big data was also brought to light as Mike Novogratz discussed the crypto revolution

“It’s a dystopian future when AI can plug into these giant data silos. If you think about all our DNA data genomes, 23andMe has five million DNA genomes, Ancestry has 10 million, This is a huge database, that gets scary” he said.

“Data shouldn’t be in one central location which could get sold or hacked, it should be behind a blockchain where people that contribute get paid. The idea of those databases not being private is a really bad thing,” said Mike Novogratz.

Privatized data was the Internet’s flaw, according to Mike Novogratz.

“All the wealth has gone into 7, 8 internet companies” he said

Mike Novogratz believes that blockchain could retool the web so that the data is not monopolized by a few big plays.

Regarding custody solution, Mike Novogratz said they are fine but they are not from companies and people that they have heard of or trust.

“Branded names are going to come into this business” he said. 

Bitcoin will be the first point of onboarding for institutions. They buy Bitcoin it will be the first that gets custody. Bitcoin is going to outperform the rest of coins for a while” he said. 

Opportunities will be in apps or applications built on top of the blockchains, where they go to individual verticals” – Mike Novogratz

Mike Novogratz discussed the crypto revolution and highlights blockchain companies as outperformers 

“The more interesting piece, in the long run, are these 100 blockchain companies striving to be one of what I think will be the world’s shared, decentralized supercomputer that processes data and authenticates it” he said.

The winners of those are going to be big winners” added Mike Novogratz

“Opportunities will be in apps or applications built on top of the blockchains, where they go to individual verticals” and he said, “there are say five decentralized gambling slots. My intuition is that there is going to be one winner in each vertical.”

Mike Novogratz discussed the crypto revolution in terms of a global phenomenon

“The dotcom was broadly based on US phenomena this is global. Cyclical is going to move much faster than in the past” he said.

“How do you deal with volatility” asked the interviewer. “You drink,” jokingly replied Mike Novogratz. “Take smaller positions in high volatility and take profits on the way up” he added. 

“I am not a hodler when I buy and it becomes overvalued I sell it” he said.

“We are long as a company in the space but you have to be disciplined investor” he added. 

Mike Novogratz also sees a bitcoin ETF. “The bet is that we are in early innings of this revolution”.

Mike Novogratz discussed the crypto revolution in terms of a virtual world

Fortnite, a free game, which makes $320 million a month selling digital clothes, a 30 billion dollar a year market. 

Mike Novogratz thinks that a financial crisis would be good for adoption because there are no crossovers. He also pointed out that risks could come from anti-regulatory bodies and hackers. Watch Mike Novogratz full interview.

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