“DeFi is the Tesla of the Crypto Industry”, Mike Novogratz

The hype around the decentralized finance (DeFi) segment continues, bringing back memories of the 2017 ICO bubble, Galaxy Digital CEO Mike Novogratz, and more …
In an interview with BNN Bloomberg, entrepreneur and billionaire Mike Novogratz, who runs investment firm Galaxy Digital, drew parallels between DeFi projects and the ambitious electric car maker Tesla. At the same time, he noted that such a similarity causes him concern.

Tesla – forward and up

TSLA shares have soared several hundred percent this year, promising cosmic profits to investors. Now Novogratz fears that a large-scale correction in many high-risk assets may soon begin in the market.

It should be noted that Novogratz is not an ideological opponent of Musk. He even owns a couple of Tesla vehicles. However, he is still alarmed by the company’s current market capitalization to earnings ratio.

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Recently, well-known economic columnist Holger Zschepitz shared on Twitter that Musk bypassed Zuckerberg to become the third richest person in the world. This was due to the rapid growth of Tesla stock.

DeFi vs. ICO

Meanwhile, according to Novogratz, the DeFi segment is now experiencing a similar “speculative fever” and irrational optimism.

The capitalization of the DeFi industry has already exceeded $ 17 billion, and the market capitalization of ETH has grown to $ 48 + billion thanks to the explosive growth of DeFi projects on the Ethereum blockchain. As with Tesla, things are going too fast and too aggressive.

During the interview, Novogratz recalled the times of the 2017 crypto bubble, triggered by the ICO boom. Then, too, there was a rapid rise in prices, followed by a collapse. However, he believes that – unlike ICOs – the DeFi phenomenon will last longer.

“Right now we are in the sandbox stage. But this sandbox attracts liquidity in volumes equal to a full-fledged “adult” industry. So be very careful, ”he warned.

In general, we recall that Novogratz continues to be a convinced crypto enthusiast. Earlier, the editorial staff of BeInCrypto has already said that, in his opinion, Bitcoin has reached its finest hour in conditions when states continue to flood the world economy with devalued fiat money. In addition, he continues to bet on the entry of institutional investors into the crypto industry.

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