Galaxy's Novogratz: AI transactions are loosened, cryptocurrency is picking up

On July 11, Novogratz gave a cautiously optimistic assessment of the market situation in the "All Markets" podcast hosted by Anthony Scaramucci: "The trading situation of cryptocurrencies this month has improved compared with the previous month." He also warned that this improvement is based on a low base, but newly launched on-chain data shows that enthusiasm at the edge of the market can indeed be quantified.

Highlights

Novogratz reported that cryptocurrency trading volume increased by 20% to 30% month-on-month on a low base basis.

He believes that the probability of passage of U.S. market structure legislation is "currently 50 - 50."

Robinhood Chain's cumulative decentralized exchange (DEX) trading volume exceeded US$1 billion in its first week of launch, and briefly surpassed Hyperliquid in daily trading volume on July 8.

Novogratz pointed out that artificial intelligence and SpaceX have been withdrawing funds from the cryptocurrency market, and that the funds rotation has only reversed at the margins.

Better trading volume with 50 - 50 opportunities

The rebound in trading volumes described by Novogratz was accompanied by his own premise: a 20% to 30% increase from depressed levels in June was simply a return to activity, not a peak. He used the same calibrated yardstick to his judgment of the situation in Washington. For market structure legislation currently under consideration in the Senate, he believes the current probability of passage is "50 - 50"-a figure that is almost consistent with the market estimate of the probability that the CLARITY bill will pass in 2026 and is well below the 60% given by Summer Mursinger, CEO of the Blockchain Association, in an interview with CoinDesk a day ago. The gap in judgment among industry insiders on the same bill has widened to 20 percentage points, which in itself reflects that the variable is no longer the essence of the policy, but the legislative agenda in August.

Robinhood's statement, verified by on-chain data

Novogratz's most poignant observations involve Robinhood's new network. He said the network's first-day usage was about three times that of Hyperliquid, and described the broker as a distribution machine with "15 million customers in the United States." On-chain data supports this statement and even goes beyond it. Robinhood Chain is an Ethereum Layer 2 network based on the Arbitrum technology stack and was launched on July 1. Within one week of launch, its cumulative DEX transaction volume exceeded US$1 billion, attracting approximately 350,000 wallet addresses and 17 million transactions. On July 8, it achieved a daily DEX transaction volume of US$560 million to US$570 million, briefly surpassing Hyperliquid and becoming the largest decentralized exchange under this indicator. Hyperliquid is no soft persimmon: It just posted the highest single-quarter revenue ever recorded by the DeFi agreement.

The composition of this transaction volume complicates the distribution theory to a certain extent, but does not deny it. The surge in trading volume on July 8 was mainly driven by CASHCAT, a memin that appeared organically on the new chain, with single-day trading volume accounting for approximately US$98 million of the total; while the chain was supposed to display tokenized stocks held only approximately US$12.6 million in on-chain assets among more than 100 listed securities.

The speculative nature of this trading volume was further highlighted in reports released on July 12: an anonymous trader successfully converted a US$838 position into more than US$1 million within 20 days by pre-empting CASHCAT's rising trend. Although this extreme, rapid high return is an exception, it just shows that the chain's initial trading volume is driven by high-risk "gamblers" rather than the institutional tokenized stock capital flow that the platform was originally designed to capture.

The distribution mechanism is clearly effective, but so far it has distributed speculation rather than tokenized finance. Balancing the balance is the quieter numbers: more than $100 million in ETH bridged to the network in a week, and DeFi's total locked value (TVL) exceeded $234 million-these flows of funds are more like deployed capital than hyped tokens.

Where does the funds flow and whether they will flow back

Novogratz's explanation for cryptocurrency's weakness in the first half is consistent with what price data for months has suggested: Artificial intelligence and SpaceX have absorbed marginal speculative money. "When momentum trading collapses, cryptocurrencies perform slightly better," he said. He described the negative correlation as evidence of funding rotation between the two transactions. He seemed particularly calm about reverse capital flows. When asked whether SpaceX's possible secondary offering would release billions of dollars to holders, he expected the money to flow into high-end real estate and discretionary spending by the elite rather than back into digital assets-because SpaceX's stake is concentrated in the hands of a small number of holders who already have what they want.

Scaramucci relayed a more optimistic view through an anonymous source: "We sold cryptocurrency to buy SpaceX, and then we will sell SpaceX to buy cryptocurrency." These two views cannot be reconciled. If a secondary sale occurs, only one will be reflected in the capital flow data. Novogratz is optimistic about the macro cloud of suppressing risky assets in early July, describing the situation in the United States and Iran as "the dying struggle of this war" and believing that the market has basically gotten rid of the influence of news related to the Strait of Hormuz, which depressed Bitcoin on July 8.

These verifiable claims will be tested at different time points. The rebound in trading volume will show up or fade in monthly exchange data in July; the 50 - 50 legislative forecast will be verified during the Senate recess window; and Robinhood's argument faces the clearest test possible: Will the chain's tokenized stock balance start to grow and overtake mein trading volume, or whether only 15 million users will eventually discover a new casino rather than a new financial system in the first week of launch.

The information provided in this article is for popular science reference only and does not constitute any financial, investment or legal advice.