Novogratz Questions Altcoin Rally After Bitcoin Offspring Surges
Novogratz Questions Altcoin Rally After Bitcoin Offspring Surges
(Bloomberg) -- One of the biggest proponents of cryptocurrencies is sounding the alarm on the monster rally in altcoins.
Bitcoin maven Mike Novogratz took to Twitter to profess skepticismover the swiftness and breadth of a surge that took many by surprise this week.
“I am not sure I understand the altcoin rally,” said the chief executive officer of Galaxy Digital Holdings Ltd. in a Twitter post on Wednesday. “Happy for those making money on it. But not sure what changed,” he said, offering up a dinner in exchange for the best explanation.
Novogratz isn’t the only one to assert confusion over the run-up.The surge higher this week prompted a guessing among many in the crypto community as to what could have caused prices to spike so dramatically in a matter of a few days. Some estimated that the debut of new options linked to Bitcoin could be behind the exuberance.
To Flipside Crypto Inc.’s Dave Balter, it may have more to do with Visa Inc.’s acquisition of Plaid, a fintech firm that connects apps to customers’ data in the banking system. Plaid’s developer tools help power Coinbase Inc., among others.
“If you’re in the crypto investing business, I think it’s a pretty big signal of confidence that the true financial institutions are entering the space and continuing to do big things,” said the firm’s chief executive in an interview at Bloomberg‘s New York headquarters.
Bitcoin SV, an offshoot of the largest digital token, posted one of the biggest moves among altcoins, more than doubling in value this week after one of Bitcoin’s self-proclaimed investors told a court he would be able to provide a list of his holdings. His move could shed light on his claims that he owns a huge swath of the original coin.
But investors and skeptics alike continue to weigh in, questioning the rally that also saw Dash, for instance, gain more than 104% since Friday. Bitcoin Cash is up nearly 25% in that period, Bloomberg data show.
“It’s a renaissance and I’m not particularly excited about it,” said David Tawil, president of ProChain Capital. “I don’t think it’s particularly welcomed at this point because we still haven’t gotten the fundamental building blocks necessary for the established coins or for Bitcoin. We’re still missing a fair amount of regulatory regime, legal worldwide consensus on things and to go ahead and build up another alt-coin universe, I think for most people is certainly out there on the risk spectrum.”
--With assistance from Olga Kharif.
To contact the reporter on this story: Vildana Hajric in New York at vhajric1@bloomberg.net
To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Dave Liedtka, Brendan Walsh
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