The CEO of crypto investment bank Galaxy Digital is clarifying his recent comments on XRP and Bitcoin.
At last week’s LINC 2020 conference in Orlando, Florida, Mike Novogratz said he believes Bitcoin will outperform XRP by a wide margin in 2020.
Now, Novogratz has unleashed a tweetstorm to explain his bearish call on the third-largest cryptocurrency. He admits that XRP’s performance so far this year – along with the altcoin market at large – has taken him by surprise. At time of publishing, XRP is up 43% in 2020, while Bitcoin is up 36%. However, Novogratz says the institutional investors he’s talking to remain focused on BTC.
“This year the broader alt market, including XRP has outperformed BTC. This has surprised me. That said, I see more and more large accounts getting educated and set up to be accumulators of BTC and believe on a risk adjusted basis it’s the best place to bet on crypto.”
Novogratz says Bitcoin has cemented its status in macro portfolios as a digital store of value, but investments in other cryptocurrencies are speculative in nature or “venture bets.” Some might be able to offer lasting value if they prove to be useful.
“BTC has found a place as a weapon in macro portfolios as digital gold – a hard asset. All other cryptos are venture bets and will only have lasting value if they become a product that is useful. Ethereum might be the trust level people build on. If it does, it’s a great bet.”
However, the Galaxy Digital CEO points out that both Ethereum and XRP are still in the “proving phase.”
Novogratz ends his tweetstorm with a reminder that Ripple still owns more than half of the total supply of XRP. He says Ripple will have to distribute the XRP it owns sensibly while building a real-world use case.
“The price of XRP will be determined like all prices. If there are more buyers than sellers (and the company has a lot of control here) the price will rise. The company needs to distribute in a rational way at the same time building a real and scalable use case. I hope they do.”
Novogratz certainly has a track record as an investor in the world of crypto. The former hedge fund manager told Bloomberg he sold $250 million in Bitcoin and Ethereum before the 2017 bubble burst.