Last Updated on January 11, 2023 by Bitfinsider
Although the crisis threatening Digital Currency Group (DCG) and Genesis is “not good news,” it won’t “include a lot of selling,” said Mike Novogratz, CEO of Galaxy Digital Holdings.
Novogratz stated in an interview on January 10 that he anticipates the current crisis facing DCG and its associated companies to “play out” during the coming quarter.
Novogratz said: “There are still some overhangs — DCG and Genesis and Gemini — that will play out in the next quarter. That’s not going to be great,” and further added: “I don’t think it will include a lot of selling, it’s just not good news.”
The largest digital asset management in the world, Grayscale Investments, is owned and run by DCG, a significant crypto conglomerate.
Additionally, it controls the cryptocurrency exchanges Luno and media company CoinDesk as well as the consultancy firms Foundry and Genesis that provide institutional lending.
The Jan. 4 research from Arcane Research, which cautioned investors to pay heed to the “ongoing financial distress” at DCG as the outcome that it “could severely impact crypto markets,” contrasts sharply with Novogratz’s assertion.
It made the case that if DCG declared bankruptcy, the business may be obliged to sell significant holdings in its Grayscale Bitcoin Trust (GBTC) and other cryptocurrency-related trusts, which would put pressure on cryptocurrency prices.
But according to Novogratz, Bitcoin and Ethereum have kept “pretty steady” over the past three months despite “a lot of terrible news,” and have even witnessed an increase recently.
“It’s a pretty clean market right now,” according to Novogratz, who was referring to investors who had recently sold or lowered their debt.
Genesis stopped withdrawals on November 16 due to “unprecedented market turmoil,” which was brought on by the failure of FTX and Three Arrows Capital, raising red flags for DCG and Genesis in November 2022.
Further comments on Coinbase layoffs
The Coinbase CEO’s recent move to lay off an additional 20% of his or her staff in an effort to further reduce operational costs was also addressed by The Galaxy CEO.
Novogratz said: “2022 was a grand washout for growth stocks and for crypto, and so anything associated with it… that had big costs and revenue shrinking got hammered.” He ended off stating that he thinks “CEOs Brian at Coinbase, and any rational CEO, is doing the right thing.”
Overall, the future of cryptocurrency is “not great,” but it’s also not terrible according to Novogratz.
Hardware wallets are safe and secure devices that can be used offline. They keep your cryptocurrency offline, making it impossible for you to be hacked. To find out more on the leading hardware wallets, you may view our reviews here: Ledger & Trezor
Disclaimer: The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, legal, tax or other advice. Investing in or trading cryptocurrency or stocks comes with a risk of financial loss.