Galaxy Digital CEO Mike Novogratz believes Bitcoin (BTC) is on track to meet or exceed gold’s market capitalization amid a rapid wave of retail and institutional adoption of the digital asset.
In an interview with CNBC’s Squawk Box, Novogratz said cryptocurrency “adoption’s happening much faster than I predicted,” adding that “it’s shocking to me how fast people are moving into the system.”
Novogratz, who has been involved in Bitcoin since 2013 when the digital currency was valued at around $100, explained that his previous BTC price target of $60,000 was too conservative. The initial target was based on Bitcoin achieving roughly 10% of gold’s market capitalization.
“At the beginning of the year, I thought $60,000 was my target because that would have been 10% of gold,” he said. “But I told myself and our investors that once it gets to 10% we’re all going to say it’s going to 20%, and then when it gets to 20% it’s going to go to 50% and then 100%.”
Bitcoin’s emergence as “digital gold” has strengthened Novogratz’s conviction that the cryptocurrency will eventually reach or exceed bullion’s market value:
“I do think bitcoin is on an inevitable path to having the same market cap and then a higher market cap as gold.”
Current estimates place the total market capitalization of gold at roughly $10.7 trillion. Bitcoin, by contrast, has a total market value of $1.1 trillion.
Bitcoin appears to be outshining gold in the battle of the safe havens, with some prominent analysts claiming that BTC is taking market share away from the yellow metal. In December 2020, JPMorgan Chase strategists said Bitcoin’s ascendance would serve as a headwind for bullion in the short term.
One Bitcoin is currently worth 34.49 ounces of gold. This time last year, the ratio was around 4.19 ounces.