Galaxy founder and CEO Mike Novogratz stated at a digital finance forum on Tuesday that the recent sharp decline in Bitcoin is not due to a single event but reflects a broader shift within the entire industry.

Novogratz said that in November 2022, Bitcoin fell 22% in less than a day following the collapse of FTX, which represented a "collapse of trust." He remarked, "This time, there is no smoking gun. You look around and think: what exactly happened?"

Novogratz did point to a catastrophic event in October 2025 as a significant factor. During that event, over 1.6 million traders collectively lost $193.7 billion in leveraged positions within 24 hours. He described the situation as having "wiped out a huge number of retail investors and market makers," placing substantial downward pressure on the price of Bitcoin.

"The core of cryptocurrency lies in narrative, in the story," he said. "These stories take time to build, they take time to draw people in... So, when a lot of people lose a lot of money because of it, the story doesn't just snap back," he added.

However, Novogratz also sees more lasting implications and anticipates that the current downturn will bring about changes. He suggested that as the cryptocurrency industry attracts "institutions with different risk appetites," the recent "era of speculation" in cryptocurrency investment will gradually come to an end.

"Retail investors don't enter the crypto space seeking an 11% annualized yield," he stated. "They are looking for 30x, 8x, or 10x returns."

Novogratz acknowledged that there will always be traders who speculate, but overall, "We will use the same channels—crypto channels—to bring banking and financial services to the world, thereby changing or replacing the existing financial system. So, the ultimate assets will be real-world assets, but with much lower returns."

He also noted that tokenized stocks will possess "different return characteristics."