Throughout history, bitcoin and other cryptocurrencies have experienced major price changes, whether owing to larger macroeconomic issues affecting all asset classes or during “crypto winters” caused by industry worries.
However, with the potential passage of a cryptocurrency market structure bill, many observers predicted another bull run in digital assets in 2026. However, it has been the complete opposite. Bitcoin is down more than 21% this year, dropping to $60,062.00 last week, its lowest level in around 16 months. That was roughly 50% lower than the previous record set in October 2025.
What is causing this most recent drop? At the CNBC Digital Finance Forum on Tuesday in New York City, Galaxy CEO and founder Mike Novogratz stated that it is a reflection of a broader industry movement rather than a singular incident. Novogratz told at the event that there was a “breakdown in trust” when bitcoin dropped 22% in less than a day after FTX’s collapse in November 2022. “This time, there’s no smoking gun,” he said. “You look around like, what happened?”
The October 2025 wipeout, in which over 1.6 million traders lost a total of $19.37 billion in leveraged positions in a 24-hour period, was a noteworthy event, according to Novogratz, who also claimed that it “wiped out a lot of retail and market makers” and put a lot of pressure on prices.
“Crypto is all about narratives, it’s about stories,” he said. “Those stories take a long time to build and draw people in, so when you wipe out a lot of those people, Humpty Dumpty doesn’t get put back together right away,” he explained.
However, Novogratz also sees something more enduring emerging from the present collapse, stating that the current era of cryptocurrency investing, dubbed “the age of speculation,” will eventually be phased out since the market has attracted “institutions where people have a different risk tolerance.”
According to him, retail investors don’t enter the cryptocurrency market in hopes of earning 11% annually. They enter with the intention of making 30 to 1, 8 to 1, or 10 to 1.
According to Novogratz, there will always be some traders who will speculate, but ultimately, we will use these same rails—these crypto rails—to offer banking [and] financial services to everyone on the planet. As a result, real-world investments will yield significantly smaller returns.
Tokenized stocks, he added, will have “a different return profile.”
Novogratz was asked by Sigalos if the sector may benefit from the eventual passing of the CLARITY Act, with the halt in the momentum of the crypto market structure bill on Capitol Hill serving as at least a temporary obstacle. He believes a bill pertaining to the framework of the cryptocurrency industry would finally get into law.
‘We’re going to pass the goddamn CLARITY Act,’ Novogratz stated. Both the Republicans and the Democrats want the measure to be passed.
The bill is necessary for “many reasons,” according to Novogratz, but most importantly, “We need it for spirit back in the crypto market.”
