Galaxy Digital Holdings CEO Mike Novogratz hosed down fears over the crisis facing Digital Currency Group (DCG) and Genesis saying while it’s “not good news,” it won’t “include a lot of selling.”
In a Jan. 10 interview on CNBC’s Squawk Box Novogratz said he expects the current debacle facing DCG and its related companies to “play out” over the next quarter.
“The outlook for #crypto is not horrible but it’s not great. We’ve got regulatory headwinds we didn’t have before. People are going to cut costs and survive this transition period,” says @novogratz. “Crypto is not going away. It’s a pretty clean market right now.” pic.twitter.com/k57ITlRFOV
— Squawk Box (@SquawkCNBC) January 10, 2023
“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,” said Novogratz, adding:
“I don’t think it will include a lot of selling, it’s just not good news.”
DCG is a major crypto conglomerate known as the owner and operator of Grayscale Investments, the world’s biggest digital asset manager.
It also owns institutional lending company Genesis, advisory company Foundry, crypto exchange Luno and crypto media company CoinDesk.
Novogratz’s opinion has been in stark contrast to a Jan. 4 report from Arcane Research, warning investors to pay attention to the “ongoing financial distress” at DCG as the outcome “could severely impact crypto markets.”
It argued if DCG were to enter bankruptcy the company could be forced to liquidate assets and sell sizeable positions in its Grayscale Bitcoin Trust (GBTC) and other crypto-related trusts which would put pressure on crypto prices.
Investors should pay attention to the ongoing financial distress related to Digital Currency Group (DCG) as the outcome could severely impact crypto markets.
— Arcane Research (@ArcaneResearch) January 4, 2023
However, Novogratz argued that both Bitcoin (BTC) and Ether (ETH) have held “pretty steady” despite “a lot of bad news” over the last few months and have even seen an uptick over the last few days, he said.
“It’s a pretty clean market right now,” said Novogratz, referring to investors who have sold or reduced leverage in recent months.
Alarm bells first began ringing for DCG and Genesis in November 2022 after Genesis halted withdrawals on Nov. 16 citing “unprecedented market turmoil” caused by the collapse of FTX…