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Novogratz’s 180: XRP Gets New Ally as Billionaire Fears Government Spending

Last Updated December 13, 2023 10:52 AM
Teuta Franjkovic
Last Updated December 13, 2023 10:52 AM

Key Takeaways

  • Mike Novogratz acknowledged his previous negative stance towards XRP and Ripple was inaccurate.
  • He now recognizes Ripple as a reputable institution invested in the ecosystem’s success.
  • Novogratz believes the current US government’s substantial spending has positively stimulated the economy.
  • He suggests the significant government spending may have long-term negative consequences.

Galaxy Digital’s founder and CEO, Mike Novogratz, has been a staunch crypto proponent, often urging people to invest in Bitcoin (BTC).

Despite his admiration for Bitcoin, he has not shown significant enthusiasm for other cryptocurrencies in the past. However, in a recent development, he has conceded  his initial assessment of XRP and Ripple’s business proposition was wrong.

From Skeptic to Believer – Novogratz Embraces XRP and the XRP Army

The billionaire acknowledged he had been skeptical about XRP’s potential due to Ripple’s significant ownership stake of 60% at one point. Novogratz believed that such concentrated control over circulating coins was not sustainable.

However, in a recent appearance on Raoul Pal’s Real Vision show, Novogratz praised Ripple’s resilience and its ability to overcome challenges. He commended Ripple’s CEO, Brad Garlinghouse, and the entire team, acknowledging that Ripple has evolved into an institution. Novogratz also recognized the existence of the “XRP army”, describing it as a genuine entity that genuinely cares about both the ecosystem and the digital asset.

Previously, Novogratz was famous from slamming Ripple  every time he got the chance. He event went that far to compare XRP Army with Trump supporters:

He said: “Over the years, the XRP army has built up a real community of people that really want to believe it. It reminds me a little bit of Trump supporters, they’ll believe you stole the election. You could tell them anything. It’s like 9/11 conspiracy theories. There’s a little bit of that in crypto. They just don’t look at the truth sometimes.”

XRP Lawyer Supports Novogratz’s Recognition

John E Deaton, founder of Crypto-Law.us, has voiced his support for Novogratz following his recent comments.

Deaton has revealed that the XRP army submitted approximately two thousand exhibits as evidence in Ripple’s court case with the United States Securities and Exchange Commission (SEC). Despite the substantial volume, Judge Analisa Torres only cited a few dozen exhibits in her decision.

US Spending Booms Economy, But Consequences Await

Novogratz acknowledged that US government spending, which currently accounts for approximately 25% of the country’s gross domestic product (GDP), played a role in stimulating the economy. However, he also said that there would likely be consequences or a “price to pay down the road” as a result of such substantial spending.

And that’s not all. Novogratz, previously a supporter of Joe Biden, has changed his allegiance  to back Democrat underdog Dean Phillips. Novogratz explained this shift by stating that he now believes both Biden and former President Donald Trump are too old for the job.

No Staking Rewards, No Ethereum ETF Glory

Regarding the potential for an Ethereum (ETH) spot exchange-traded fund (ETF), Novogratz expressed a less optimistic view. He said he did not anticipate it performing as well as a spot Bitcoin ETF. He added a condition that, for an Ethereum ETF to match the success of a Bitcoin ETF, there would need to be a mechanism for incorporating staking rewards into the ETF structure.

In the same interview, he also cast doubt  on the prospect of Bitcoin (BTC) being used for retail transactions. He suggested skepticism about the practicality or likelihood of Bitcoin evolving into a widely adopted medium for everyday retail purchases.

“I don’t think Bitcoin will ever be a currency that we buy Pepsi cola with. It started off [and] people bought illicit sh*t with it, but no one’s buying stuff with Bitcoin. As much as people will talk Lightning [Network] and other things, yeah you might use the infrastructure, but you’re not going to use Bitcoin as a transaction currency.”

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