Galaxy Digital CEO Mike Novogratz has provided a critical analysis of the recent sharp decline in Bitcoin's price, directly refuting market speculation that the sell-off was driven by fears over quantum computing threats. In an interview with Bloomberg, Novogratz stated that the primary driver was a shift in investor psychology, specifically a weakening of the fundamental "HODL" philosophy among early adopters, rather than technological anxieties.
Novogratz dismissed quantum computing concerns as a "general market FUD narrative," with Galaxy's Head of Research, Alex Thorn, clarifying that the CEO was merely listing it as an example of misinformation he disagrees with. Novogratz emphasized that current quantum systems lack the capability to compromise Bitcoin's SHA-256 encryption and that such a threat remains theoretical, with developers already working on quantum-resistant solutions.
Instead, he pointed to a "seller's virus" that has infected the market. According to Novogratz, after Bitcoin crossed the $100,000 level, a sense of victory led to widespread profit-taking. "There was buying, sure. Lots of new institutions are coming in, but prices are set in the margin, and there have been more sellers than buyers," he explained. This trend is particularly evident among early Bitcoin investors (pre-2017) who are now engaging in natural portfolio rebalancing, generational wealth transfer, and tax optimization after witnessing monumental gains.
The sell-off was severe, with Bitcoin crashing below $74,000, erasing gains made during a period of friendlier U.S. regulation. While Novogratz believes Bitcoin is getting "close" to a bottom, he remains cautious, noting "You always know the bottom after you see it." He identified a potential bullish catalyst in the possible passage of a market structure bill in the U.S. Senate, expressing optimism due to bipartisan desire for its completion.
This shift from an ideological "HODL" mindset to normalized profit-taking signals the maturation of cryptocurrency markets, integrating them further with global finance through increased institutional participation, derivatives growth, and ETF proliferation.
