Simply put
- Mike Novogratz believes the “age of speculation” in the cryptocurrency space is behind us, signaling a shift towards the tokenization of real-world assets.
- Galaxy has initiated a $100 million hedge fund that will allocate 30% to cryptocurrencies and the remaining 70% to stocks within the financial services sector.
- The sudden market drop in October 2025 caused a $19 billion loss in derivatives, leaving a significant mark on the market narrative.
In a recent interview, Galaxy CEO Mike Novogratz stated that the speculative fervor that once gripped crypto traders is fading. He mentioned that the market will transition, allowing banks to operate using crypto infrastructure, effectively transforming real-world assets into a different kind of asset, albeit with lower returns.
Novogratz noted that the shifts in the crypto landscape mirror broader changes in the financial sector. He drew parallels between the downturn in November 2022 following the FTX collapse and the October 2025 flash crash, where substantial value in crypto derivatives vanished.
Interestingly, the Bitcoin drop in October did not have a specific trigger like the FTX incident, yet it still left its mark.
“Every piece of code tells a story that builds over time,” he remarked, suggesting that even when many traders exit the market, it doesn’t immediately bounce back.
However, he hasn’t lost his appetite for the crypto industry itself.
Galaxy is working on a $100 million hedge fund that aims to create a balance between cryptocurrency exposure and stock market investments. The fund is anticipated to be up and running by the end of March.
The strategy involves investing up to 30% in crypto assets, while the majority will focus on financial service stocks that are likely to be influenced by developments in digital asset technologies and regulations.
Novogratz also pointed out that there’s a growing interest in tokenization, which entails bringing off-chain assets like stocks and bonds onto the blockchain. Yet, he cautioned that the returns from tokenized stocks would differ from the high-risk, high-reward nature many crypto traders seek.
Bitcoin’s price has seen a steep decline, dropping more than 47% from its peak of over $126,000 in October to around $66,551, and it even fell to approximately $60,000 the previous week. In the past week, Bitcoin fell by 10%, while Ethereum followed suit, and other notable altcoins like XRP and Solana experienced even greater losses during the same timeframe.
