Ex-hedge fund manager and chief executive officer of Galaxy Digital, Mike Novogratz, says news of PayPal’s crypto adoption will inspire all banks to cater to Bitcoin and crypto.
On Wednesday, payment services app PayPal announced it will soon allow users to purchase, sell, and store cryptocurrency on its platform, starting with Bitcoin, Bitcoin Cash, Litecoin and Ethereum.
Novogratz says he expects the announcement to trigger a chain reaction that forces banks to face crypto’s huge potential.
“This PayPal news is the biggest news of the year in crypto. All banks will now be on a race to service crypto. We have crossed the rubicon people. Exciting day.”
Novogratz has been foreshadowing Bitcoin bank adoption prior to the PayPal announcement. Earlier this month, Novogratz spoke with journalist and Defiance podcast host Peter McCormack about the factors that have led to his increased belief in Bitcoin and the next steps toward a more universal adoption of the asset.
“[Bitcoin’s] now gone through the great crash of 2018 and reemerged from that crash. And I think we had a huge inflection this March/April with COVID, in that COVID gives such a strong macro backdrop to the hard asset story and to the Bitcoin story in particular. And we went over the rubicon or we went over the hill in terms of it being an established asset…
[BTC is] now a legitimate macro asset. Two years ago it was in what I call the ‘venture sandbox’… When you’re thinking about mom and pops, when you’re thinking about institutions that have a fiduciary responsibility they need a lot of surety to get there and Bitcoin’s made it…
I always tell people Bitcoin’s price would be a ton higher if it was easy to buy… You can’t call Goldman Sachs or Morgan Stanley or JP Morgan or E*Trade or get on the phone with your broker and say ‘buy me some Bitcoin’ and ironically we’re pushing those guys to get involved…
We’re starting to see that shift quickly. So I think in one, two, three years you’ll see all those guys getting involved… it’s really customer demand that will drive their action.”
The Office for the Comptroller of the Currency (OCC), a top US banking regulator, recently said banks have the green light to offer crypto custody services to their customers.
So far, traditional banks have not jumped on board. However, a number of banks have answered a request for comment from the OCC, including PNC Bank, which has praised the OCC’s approach as a positive development for the banking industry at large.
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