What Galaxy CEO Mike Novogratz Sees in Crypto's 2026 Recovery Path

Mike Novogratz, CEO of Galaxy Digital, believes 2026 could mark a turning point for digital assets—but only if certain technical conditions materialize. Currently trading around $95.42K, Bitcoin still needs to reclaim the $100,000 psychological level to signal real momentum in the eyes of the prominent investor.

The Forgotten Asset Problem

Bitcoin faces an unusual challenge: despite mirroring the macroeconomic narratives that have driven precious metals higher, it has dramatically underperformed compared to gold in recent cycles. While gold has experienced “monster moves” fueled by inflation fears and currency debasement concerns, Bitcoin has remained relatively flat despite featuring the same underlying drivers.

“Crypto has been such an underperformer,” Novogratz explained. “It’s got the same story as gold, and it hasn’t been gold at all this year. It’s got all the ingredients—it’s just not moving yet.”

This disconnect suggests the market isn’t pricing in the macro factors that should theoretically support the asset class.

Market Apathy as a Hidden Strength

What many interpret as weakness might actually be setting up a powerful reversal. In financial markets, periods of extreme disinterest often coincide with capitulation—the moment when pessimistic sellers have already exited, leaving fresh capital to drive the next cycle.

The current state of retail crypto sentiment reflects this dynamic. Negativity pervades social media discussions, and mainstream hype has evaporated. For Novogratz, this contrarian indicator is decidedly bullish for 2026.

“The negativity in crypto is a contrary indicator,” he said. “Macro sentiment shows retail crypto dead on social media. That makes me positive.”

This lack of overheated sentiment means the conditions for sustainable upside remain intact without the dangerous euphoria that typically precedes crashes.

Japan’s Rate Shock: A Canary in the Global Coal Mine

Beyond digital assets, Novogratz has flagged a critical macro warning that could reshape global markets. Japan, the world’s fifth-largest economy, has maintained near-zero interest rates for decades. The recent spike to 2% represents the largest move in Japanese long-end rates in years—a shift from roughly 10 basis points to 200 basis points.

This matters because cheap Japanese capital has funded risk assets globally. As those rates normalize, funding conditions tighten worldwide, creating spillover effects in U.S. and other markets.

“That single move in Japanese rates might be the canary in the coal mine,” Novogratz cautioned. “It signals what could happen in places like the US if inflation forces rates higher than expected.”

The implication: if the Federal Reserve faces similar rate pressures, the consequences for leveraged positions and global markets could prove substantial—making this moment in Japan a crucial early warning signal.

The Path Forward for Bitcoin

For Bitcoin to generate the excitement Novogratz anticipates, it must clear the $100,000 barrier and establish sustained momentum above that level. Until then, despite the favorable macro backdrop and contrarian sentiment setup, the crypto market remains in a holding pattern—waiting for the technical confirmation that unlocks the next leg of the cycle.