He argues that the passage of stablecoin and market structure legislation will create conditions for continuous participation — a stark break from the stop-start four-year cycle tied to Bitcoin halvings.
For years, many investors have treated Bitcoin’s supply halving as the metronome of the industry, mapping rallies and corrections to its four-year rhythm. But Novogratz believes the GENIUS Act, which establishes rules for stablecoins, and the CLARITY Act, which clarifies which U.S. agencies regulate digital assets, represent a new framework altogether. With legal certainty, he said, crypto can flow more seamlessly into mainstream financial products and social applications.
This shift, he suggested, means investors may not dump their holdings en masse at the end of a cycle as they did in 2017 and 2021. Instead, adoption could be steadier, supported by the everyday use of stablecoins on consumer platforms.
The CLARITY Act still faces political debate. Coinbase’s Brian Armstrong has described the bill as a “freight train” making its way through Congress, while lawmakers on the House Financial Services Committee are targeting a vote later this year.
Novogratz acknowledged that Democratic skepticism — particularly around the Trump family’s ties to the sector — could slow momentum, but argued the resistance is fading. “It’s dumb for Democrats to be anti-crypto,” he said, noting that enough members of the party now recognize its value to ensure the legislation moves forward.
Even as regulatory progress gathers steam, markets remain volatile. Earlier this week, nearly $200 billion was wiped from spot crypto capitalization. Novogratz attributed the downturn to heavy selling by Chinese miners and a wave of negativity triggered by Arthur Hayes, who disclosed he sold his entire HYPE token position — reportedly to fund a Ferrari purchase. The token has since dropped more than 20%, dragging sentiment down with it.
Despite the chaos, Novogratz dismissed the selloff as a shakeout rather than a structural threat. With new laws laying the groundwork for long-term growth, he argued, the crypto market is positioned to look very different from the boom-and-bust cycles of the past.
Source: Bloomberg
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