TLDR
- Mike Novogratz stated that XRP could lose relevance if it fails to deliver real-world utility.
- He believes the crypto market is moving away from tokens driven by community hype.
- Novogratz emphasized that investors now prioritize projects with tangible economic output.
- He mentioned XRP as a network nearing a critical inflection point in its development.
- XRP supporters criticized Novogratz by referencing his past support of failed projects.
Galaxy Digital CEO Mike Novogratz warned that XRP and Cardano may face reduced relevance without clear real-world utility. He made the statement during a recent discussion with Galaxy’s Head of Firmwide Research, Alex Thorn, on market evolution.
They discussed blockchain trends such as asset tokenization, artificial intelligence, and how investors now assess token value more critically. Novogratz argued the industry is shifting from hype-based valuations to projects that generate revenue and utility. He stated XRP and Cardano are nearing a point where utility will define their survival.
XRP Faces Pressure to Prove Its Utility
Mike Novogratz questioned the long-term relevance of XRP if it fails to demonstrate real-world usage and economic value. He argued that XRP, despite a loyal community, must evolve to meet current investor expectations. “The market is asking, ‘How much value does this network actually generate?’” he said during the conversation.
He believes that community-driven narratives are losing traction as investors prioritize business models and cash flow. In his view, XRP has relied heavily on its branding and loyal user base since its early years. However, he warned that might not sustain its position as investor focus changes.
Novogratz also referred to XRP’s position in the market as increasingly challenged by newer alternatives. He said tokens without real economic output could struggle in the next market cycle. This transformation, he said, may unfold gradually over the next one to three years.
XRP supporters responded quickly to Novogratz’s assessment, questioning his credibility based on past endorsements. Crypto personality Alex Cobb pointed to Novogratz’s backing of Terra (LUNA), which collapsed in 2022. Cobb reminded the community that Novogratz even got a tattoo in support of the failed project.
Supporters argued XRP already plays a role in real-world applications such as cross-border payments and treasury use. They cited examples like its integration with payment platforms and its growing decentralized finance footprint. Projects like Flare Networks and Axelar were mentioned as evidence of ongoing XRP adoption.
XRP community members emphasized its 13-year track record and past performance in market cycles. They argued that XRP continues to evolve while securing practical use cases. XRP advocates stressed that the network already meets real-world needs in areas like remittances and financial infrastructure.
Cardano Also Cited as Facing Similar Pressure
Novogratz also named Cardano as a blockchain needing more practical applications to justify its market position. He said Cardano has maintained a strong following but still lacks broad economic use. He highlighted the importance of proving utility beyond maintaining a solid community base.
Cardano founder Charles Hoskinson received credit from Novogratz for developing a resilient chain. However, he said the project remains underused despite technical progress. He urged all blockchain projects to focus on business models with clear revenue.
Novogratz mentioned Cardano in the context of the market’s changing expectations. He described it as part of a group of tokens with potential but unproven real-world output. He framed the challenge as survival in a market that rewards results over promises.
Cardano has introduced its privacy sidechain, Midnight, aimed at enterprise smart contracts. Supporters see it as a way to attract developers and improve adoption. They view Midnight as a step toward delivering real-world utility that investors now demand.
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