Bitcoin $20,000. That’s the target Wall Street legend Mike Novogratz of Galaxy Investment Partners is setting. Not long after his Bitcoin $10,000 prediction just weeks ago, the cryptocurrency hedge-fund manager now says it’s easy “to see Bitcoin at $20,000 by the end of next year” and that there’s a “herd of investors coming.”

Mike Novogratz Bitcoin $20,000 – Video

Mike Novogratz’s on Bitcoin $20,000 including perspectives on investor interest and what it will take for Cryptocurrency to go mainstream.

In the Reuters interview by Conway Gittens, Novogratz explains his position on Bitcoin, says he believes it to be less risky than other markets, and talks about an alternative to centralized banks in the wake of banks and governments betraying the public’s trust. He also outlines what might prevent Bitcoin from reaching it’s potential including a move by the G20, a catastrophic hack and even President Donald Trump.

Mike Novogratz Bitcoin $20,000 Transcript

Conway Gittens:
But, can I just ask you: Why do we need Bitcoin? I mean we have dollars, we have Euros we have Yen. We have gold – you mentioned gold – we already have gold. We have stocks, we have bonds. Why does the world need a cryptocurrency?
Mike Novogratz:
So, Bitcoin represents a lot of the energy of this whole de-centralized revolution, and listen setting up a decentralized system has a tremendous amount of appeal to people. You know, right now in a lot of systems we’ve got to trust something. So, if you’re in Venezuela you have to trust the central bank was going to behave responsibly. Well guess what? They didn’t. At one point Zimbabwe– the currency can be used as toilet paper it was so worthless. And, so if you were in Zimbabwe and you are trying– Guess what? The central bank, the government, let you down. In 2008, it felt like here in America that the government and banks had let us down. And, so people thought Can we come up with another system that we don’t have to trust one person, that trust can be distributed across a variety of people. And, so the genius of this technology is not one person controls it
Conway Gittens:
So, not one person controls it but that makes the value of it quite volatile. I mean, just the last four days we saw – what it lost one third of its value, and then today Monday it’s up a thousand bucks?
Mike Novogratz:
Coming back baby. Listen, the volatility is here because we’re still in the early stages of this revolution, this experiment. Right? I mean you know Bitcoin started in 2008, 2009 really. So, we’re not even eight years in. Ethereum less than three. And so, we’re slowly getting adoption around the world. There’s a there’s a networking effect; as one guy gets in, he gets his friend, and he gets his friend in. And, you know I think there’s roughly 20 million Bitcoin or cryptocurrency wallets in the world. Probably two thirds of those are active. And so, that’s 12-13 million people of 7.4 billion. And so it’s still a small experiment where there’s a lot of nerves. Prices have gone a lot and we’re going to continue to have volatility.
Conway Gittens:
And, what about those prices? What about that value you mentioned how it’s not backed by any one person? And, quickly it reminds me of the .com bubble where people were saying the old rules don’t apply, you know. You know they don’t have any profits but they have this other measure. And then when that then the bubble burst and people were harmed significantly. I mean this– I mean this is a huge investment.
Mike Novogratz:
There is risk in this space. I think there’s a lot less risk than than than the market things for a bunch of reasons. Listen, it’s as wild as the prices were in the dot com bubble, bubbles happen around things that fundamentally changed the way businesses orchestrate and are we live our lives. The railroad bubble changed the way we live. The dot.com bubble changed the way we live. The internet is so much more ubiquitous today in 2017 than we ever dreamed it would have been in 98-99. Right? I mean literally, it’s everywhere. And I’m fairly certain that 15 years from now decentralized technologies – blockchains will be everywhere. It will just be a part of our lives.
Conway Gittens:
Just 15 years from now what is the thing that makes this mainstream? What is the thing? I mean, because right now it’s on the fringe – what really brings it to Main Street?
Mike Novogratz:
Well there are two things right. So, there’s a viral networking effect and so pretty soon you’re going to see real institutions. I should say real, more established institutions, players like Fidelity. Abby. Abby Johnson has been a big proponent of this. Once Fidelity offers bitcoin on their platform, then every Mom and Pop with a Fidelity account can call up and say “Buy me some bitcoin.” That will wildly accelerate the price up, but it will accelerate the education and the institutionalization of it. When Square or Pay-Pal or Venmo has a Bitcoin option where you can buy bitcoins on those– on those systems. So, ease of access. When JP Morgan or Goldman Sachs allows their high net worth salespeople. You know the traditional access points of institutional money, that will really accelerate the adoption not just in bitcoin but the whole crypto space.
Conway Gittens:
So, I know we’ve got to run. On December 31st, 2016 Bitcoin wasn’t even a thousand dollars. Today it’s at sixty-four hundred dollars. What is your projection? What is your outlook for the pricing of bitcoin?
Mike Novogratz:
Because, and I said recently that I thought Bitcoin would be at $10,000 you know within three to six months. That was two months ago. It’s easy for me to see Bitcoin at $20,000 by the end of next year. I see a herd of investors coming to participate in this space. I see a tremendous amount of talent all around the world focusing on building companies and building infrastructure in this space. I see the CME is setting up a futures exchange. Lots of different competitors trying to set up securities lending and futures. And so, were going to see this ecosystem mature.
Conway Gittens:
So there are always risks to projections. What stops that from happening?
Mike Novogratz:
You know there are plenty of risks. I mean, I think the biggest risk, and I think its low probability, would be a concerted G20 effort against the system. I don’t see that, I mean Christine Lagarde came out with a very positive speech maybe three weeks ago. The U.S. regulators have been very open minded. They’re working with the system, not against the system. And so right now I think there’s a tailwind. We’ve got a pretty crazy President, you know, who knows he could turn in reverse and you know say something and do something that would be negative. Again, I don’t think it’s a high probability. You know there have been hackings most of those hackings happen on on platforms built on top of the system. It’s virtually impossible to crack the Bitcoin or the Ethereum code themselves. I think it’s literally like the energy of 18 galaxies times 100 galaxies. Ain’t going to happen. But there are plenty of weaknesses on people building on top of the code getting money in. And so, there’s been a couple of public ones that have set the set the system back a little bit. If you had a whole bunch of those happen at once people will lose confidence. I don’t see that happening. But again that’s a risk.
Conway Gittens:
Although it does take just a little itty bitty thing to rock confidence in Bitcoin as we can see over the last couple of days. This is Mike Novogratz. He is the CEO of Galaxy Investment Partners. I’m Reuters business correspondent Conway Gittens. Thank you for joining us.

 

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