Mike Novogratz is ready to make a comeback to money management after two years of exile from Wall Street. He is starting a $500 million hedge fund to invest in Bitcoin and related cryptocurrencies. In an interview given to Bloomberg Television, Novogratz, however, declined to confirm such a thing, citing regulatory constraints. He expressed his eagerness in trading with cryptocurrencies.
Novogratz believes that Bitcoins need regulation and many ICOs may turn out to be fraudulent. A source familiar with Novogratz’s plans suggests that his hedge fund will have a broad mandate and will also include arbitrage, market-making, stakes in internet coin offerings and venture capital-style investments in digital-asset development.
His business partners, David Namdar, a trader at Marto Capital, Millennium Partners, and UBS AG and Richard Tavoso have a long-standing experience in hedge fund investing and compliance. Many large financial institutions stay away from the cryptocurrency market owing to scepticism, but Novogratz craves the opportunity, due to his insatiable taste for risk.
He estimates that he now has about 20 percent of his net worth in digital assets. In addition to cryptocurrencies, he has invested in trading platforms, bitcoin mining, initial coin offerings, pre-ICO sales and blockchain technology. With his hedge fund, he will be able to capture trading opportunities that require more scale and will have influence over developers, regulators, and entrepreneurs.