Novogratz highlighted that Galaxy Digital also felt the weight of what happened with the Terra ecosystem, especially since they got listed as investors in the project at the end of 2020.
The famous CEO of Galaxy Digital, Mike Novogratz, spoke about the situation of Terra space and highlighted that as well as many affected, both he and his entity got hit by the fall of UST and LUNA prices.
Novogratz Shares his Thoughts about the Fall of Terra
Novogratz’s statements happened in a letter specially sent to the shareholders of Galaxy Digital. He contextualized the situation under which the entity invested in Terra and the disastrous events.
Novogratz expressed no good news about what happened in the markets or the Terra ecosystem. In LUNA and UST alone, $40 billion of market value got destroyed quickly. Both large and small investors watched how all the profits and investments vanished in front of their eyes. The collapse dented confidence in digital assets and Defi. Every time money gets lost in fashion; people seek the truth about what happened there.
Galaxy Digital invested capital in Terra and its tokens during the last quarter of 2020. Novogratz highlighted that the entity had shown interest in financing the project due to the terms of the payments.
A Difficult Macroeconomic Panorama
Another aspect that Novogratz referred to is that the situation of Terra took effect amid a macroeconomic context that was quite harmful to the financial world, so LUNA and UST got significantly impacted by conditions even outside the digital asset sector.
Novogratz also spoke about the decline in the prices of traditional assets since the beginning of 2022, added to the inflationary scenario that is harming many economies worldwide, and the measures the central banks accepted to manage these situations.
The Way to Follow
Novogratz also highlighted that this situation with Terra and the macroeconomic scenario does not imply the possibility of a sudden recovery of the crypto market. This situation will require reflecting on what happened and wait for the foundations to be available for a more organic evolution, which first goes through recovery and confidence in this sector.
Novogratz’s statements take place amid the debate that the Terra ecosystem is experiencing internally to decide its future since the vote to determine if the network gets forked.
By: Jenson Nuñez
