ADVERTISEMENT

Company News

Novogratz Says Odds of a Bitcoin Strategic Reserve Under Trump Are Low

Michael Novogratz (Michael Nagle/Bloomberg)

(Bloomberg) -- Michael Novogratz, the billionaire head of crypto investment firm Galaxy Digital, said there is a low likelihood that the US will set up a Bitcoin strategic reserve as proposed by President-elect Donald Trump.  

“I still think it’s a low probability,” Novogratz said during an interview Wednesday on Bloomberg Television. “While the Republicans control the Senate, they don’t have close to 60 seats. I think that it would be very smart for the United States to take the Bitcoin they have and maybe add some to it and say we want to show the world that we are going to be a technology first country, a crypto, digital asset first country... I don’t necessarily think that the dollar needs anything to back it up.”

Trump said during a Bitcoin conference in July that US would keep all Bitcoin the government holds or will acquire, transforming “that vast wealth into a permanent national asset to benefit all Americans” once he became the president. Other proponents have suggested that the US buy around 1 million Bitcoin, which would be worth more than $90 billion based on the current prices of the cryptocurrency. 

If the US does set up a Bitcoin strategic reserve, Novogratz predicted that the price of the largest digital token would soar to $500,000. Bitcoin was trading at a record of roughly $92,500. 

“If we get the Bitcoin reserve, as a guy who owns a lot of Bitcoin, I won’t cry,” Novogratz said. “I think Bitcoin heads to $500,000. It is a different paradigm because it forces every other country in.”

The resounding presidential election victory of Trump last week has driven a more than 30% gain in crypto market bellwether Bitcoin and lifted the overall value of the digital-asset market above its pandemic-era peak. Trump, who was a crypto skeptic during his first administration, has since become a vocal advocate, with his family even launching a decentralized finance project. 

Novogratz, a former Goldman Sachs and Fortress Investment Group partner, saw his net worth jumped to about $5.4 billion this week, up $3.8 billion from the end of 2022. His digital-asset firm posted its largest trading day of the year on Nov. 6 in the wake of Trump’s victory. 

Read: Novogratz, Winklevoss Twins See Wealth Surge on Bitcoin Revival

Novogratz, a long-time Democratic Party backer, went on X earlier Wednesday to criticize comments from Senator Elizabeth Warren of Massachusetts lambasting Trump’s announcement that billionaire Elon Musk and entrepreneur Vivek Ramaswamy will lead a new Department of Government Efficiency. The effort, which abbreviates to DOGE, is a play on one of Musk’s favorite internet memes, and Musk has been an advocate of the digital token Dogecoin. 

Warren has been a vocal critic of the crypto and a favorite target of complains from industry participants. 

--With assistance from Katie Greifeld and Matthew Miller.

©2024 Bloomberg L.P.