Novogratz on Fiscal Reality: Bitcoin, Gold, and the Coming Minsky Moment

Galaxy Digital’s Novogratz Warns of Brewing Crisis: U.S. Entering Its ‘Minsky Moment’

Mike Novogratz, CEO of Galaxy Digital, believes the U.S. economy may be approaching a critical inflection point—one that echoes the warning signs of a classic “Minsky Moment.” In a recent CNBC interview, Novogratz pointed to rising interest rates, mounting debt, and political uncertainty as signals that financial complacency is coming to an end.

“We’re beginning to look less like a stable, developed economy and more like an emerging market,” Novogratz said, citing the rare combination of a weakening dollar alongside elevated rates. He attributed part of this shift to resurging tariffs and geopolitical tension, as well as the renewed influence of former President Donald Trump on fiscal policy.

Although U.S. equities are down around 10% year-to-date, Novogratz believes that drop doesn’t yet reflect the magnitude of macroeconomic risk. “Markets haven’t fully woken up,” he said. “We’re clearly in a risk-off mode.”

Bitcoin, he noted, has historically thrived under such conditions—serving as a hedge against systemic instability. According to Novogratz, two forces are propelling bitcoin’s relevance: the macroeconomic narrative of capital fleeing into alternative stores of value, like gold and BTC, and the broader, still-developing adoption story. He emphasized that bitcoin is gradually decoupling from traditional risk assets, underscoring its emerging role as a financial safe haven.

Highlighting the unsustainable trajectory of U.S. fiscal policy, Novogratz invoked economist Hyman Minsky, whose theory suggests that prolonged periods of financial stability often sow the seeds of future instability. The U.S., he argued, may now be reaching that moment of reckoning, where deficits and debt loads begin to materially impact investor confidence.

Even modest increases in Treasury yields are proving costly, Novogratz warned. With over $35 trillion in national debt, rate hikes of just 25 to 50 basis points could translate into hundreds of billions in additional interest payments—potentially exceeding the budgets of major federal agencies.

“This is the market sending a message,” he said. “The era of easy money and limitless borrowing may be behind us.”