Galaxy Digital CEO Mike Novogratz believes financial markets are grappling with a profound shift, one that’s rattling investors and pushing them toward traditional safe havens like gold, even as the crypto market struggles to find its footing.
Speaking to CNBC on Wednesday, Novogratz said the recent surge in tariffs took many by surprise and has sent shockwaves through the global economy. He linked the market reaction to wider geopolitical shifts, where the long-standing global security and economic framework is now undergoing a fundamental transformation.
“Trump saying, ‘wait a minute, I want to change that,’ has introduced major uncertainty,” Novogratz said, noting that this disruption is being felt across asset classes.
Crypto Demand Wanes as Uncertainty Drives Buyers Toward Bullion
The US stock market has dropped nearly 10% this year. Novogratz believes that is an underreaction. He points to major structural changes now underway.
“People are in a risk-off mindset,” he said, noting that Bitcoin, often seen as a hedge in turbulent times, struggles when fear suppresses adoption. “We’ve seen very few new buyers,” he added, suggesting that the chaos is sidelining fresh investment in digital assets.
Gold, meanwhile, is reflecting investor anxiety. “Bitcoin and gold are report cards on financial stewardship,” Novogratz said. He pointed to rising bullion prices as a sign of declining trust in fiscal leadership. Foreign central banks are buying more gold. Novogratz predicted a BRICS-backed currency could emerge within two years, possibly tied to gold.
Novogratz Flags Early Signs of a Broader Economic Reset
The macro backdrop is also beginning to resemble patterns typical of emerging markets, according to Novogratz. “Interest rates are higher, the dollar is weaker. That means we’re starting to behave more like an emerging market,” he warned, noting that for decades, developed markets could run deficits without bond markets reacting. That era may be ending.
The bond market’s recent volatility reflects deeper concerns about Washington’s approach. “The markets are saying you’re going too fast and the strategy’s not going to work,” Novogratz argued. He pointed out that even small rate hikes now carry enormous costs, given the US’s $35 trillion debt load.
The tariff hike, he added, is unlikely to meaningfully reduce the fiscal deficit. “This tariff move accounted for about 2% of taxes, or income taxes, and payroll taxes are 85%,” he said. At the same time, slashing taxes elsewhere further complicates the math. “The numbers don’t add up, and that kind of uncertainty has just scared markets.”
Novogratz sees the current volatility as more than a short-term dip. He believes it marks the start of a larger reset. Investors are seeking stability. Governments are rethinking global economic integration. As a result, the crypto industry may have to wait for calmer conditions before adoption picks up again.
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