Quick Breakdown
- Legislation impact: Novogratz says the GENIUS and CLARITY Acts will drive a surge of new crypto investors.
- Cycle disruption: Stablecoin adoption and broader participation may prevent a repeat of past four-year market cycles.
- Market slump: Novogratz links the recent selloff to Chinese miners and Arthur Hayes’ bearish moves.
Legislation seen as catalyst for market shift
Galaxy Digital CEO Mike Novogratz believes the passage of two major US crypto bills could reshape the industry’s traditional four-year cycle. Speaking to Bloomberg on Tuesday, he pointed to the stablecoin-focused GENIUS Act, signed into law in July, and the still-pending CLARITY Act, which outlines which agencies regulate digital assets.
“With those two bookends of legislation, it’s going to unleash a tremendous amount of new participation in crypto,”
Novogratz said.
Historically, the crypto market has followed a pattern tied to Bitcoin halvings, which occur roughly every four years. The most recent halving happened in April 2024, leading some investors to expect a market peak by year-end. But Novogratz argued this cycle will be different, citing the newly legalized use of stablecoins in everyday applications like iPhones and social platforms.
Coinbase’s Armstrong calls CLARITY Act a “Freight Train”
Coinbase CEO Brian Armstrong has also backed the CLARITY Act, describing it earlier this month as a “freight train leaving the station.” The bill, which has bipartisan support, is expected to see action in Congress later this fall. Representative French Hill recently said the House Financial Services Committee is eyeing October or November for potential movement.
Novogratz acknowledged that Democrats could still raise objections, especially over concerns about the Trump family’s involvement in crypto. However, he said there is already enough Democratic support for the legislation to pass.
Market volatility blamed on miners and Hayes
Addressing the recent $200 billion crypto market slump, Novogratz attributed the downturn to large-scale selling by Chinese miners and bearish commentary from BitMEX co-founder Arthur Hayes.
“Hyperliquid got hit the hardest, and that hit some of the overall sentiment in the market, but I think this is just a pullback,”
he said.
Hayes recently sold his entire HYPE holdings to fund a Ferrari purchase, a move that coincided with the token’s 23% drop from its peak last week.
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