Mike Novogratz Urges Cutting Costs to Persevere Through This Transition Period

Michael Novogratz, the founder of the American crypto financial services organisation Galaxy Digital Holdings, suggested that 2022 had cleared the field for the industry, leaving it time to get through the transformation phase. During an interview with CNBC on Tuesday, Novogratz stated that 2022 was a tremendous blow to the crypto industry, adding that everything that had high expenses and receding profits was severely affected.

He noted that there had been a lot of bad news which resulted in people selling their stocks and getting out of leverage, making the market much more clean. He also warned that 2023 is a year everyone should strive to "survive". Novogratz went on to say that the current outlook for crypto is not good, but it is not disastrous either. He argued that while they have to deal with increased regulation, this is a period of healing and rebuilding of the narrative which will require people to cut costs in order to make it through the transition.

More good news for the crypto industry is on the horizon, according to the CEO. The values of bitcoin and ethereum have been comparatively steady in the last couple of months and have improved in the last few days, he pointed out.

BTC prices have increased by 1% in the past 24 hours and 4.5% in the week, with it being traded at $17,442 at 9:10 UTC Wednesday morning. Meanwhile, ETH prices have risen less than 1% in a day, but nearly 10% in a week and current stands at $1,334.

While the market is somewhat stable overall, there are still lingering issues - such as DCG, Genesis, and Gemini - that will be worked out in the upcoming quarter, which may not be pleasant news, the CEO added.

The CEO's remarks come amidst a deteriorating crypto-landscape, with many companies crumbling and layoffs occurring throughout the industry in an effort to prevent further bankruptcy. This tumult has been compounded recently by the downfall of FTX, as well as the collapses of Terra/LUNA, Three Arrows Capital and Celsius Network in the months prior.

Following the failure of FTX, the lending division of Digital Currency Group (DCG), Genesis Global Capital, announced that it was suspending loan issuance and redemptions. Recently, the temporary

CEO of Genesis Global Trading, Derar Islim, notified clients that additional time was needed to address the financial issues affecting the lending business.

Additionally, US prosecutors are looking into DCG's internal dealings with the parent company and its lender, as reported by Bloomberg on Friday from sources that wished to remain anonymous.

Separately, the Winklevoss twins have been taken to court by investors over their Gemini Earn program which offers interest-earning accounts.