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Institutional investors now guide crypto markets as retail demand for extreme gains continues to fade.
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The FTX collapse reshaped risk management and pushed investors to focus on trust and transparency.
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October liquidations exposed fragile momentum while tokenized real world assets gained attention.
Galaxy CEO Mike Novogratz says big institutions steer the crypto market. He made the remarks at the CNBC Digital Finance Forum in New York. He said large firms now look for stability instead of high-risk trades. That shift, he explained, signals a different stage for the industry.
Crypto’s ‘age of speculation’ may be over, says Galaxy CEO Mike Novogratz https://t.co/P7Lxv8kAQm
— CNBC (@CNBC) February 10, 2026
He recalled that earlier cycles depended on retail excitement. Small investors once rushed in hoping for sharp gains. Many targeted life-changing returns within short periods. Now, that aggressive appetite has cooled.
Institutions Shift Market Priorities
Novogratz said retail traders once powered strong rallies in digital assets. Social momentum and fast-moving narratives often drove prices higher. In contrast, institutions focus on steady yearly performance. They approach crypto with portfolio discipline.
Large firms study liquidity conditions before deploying capital. They examine custody arrangements and regulatory exposure as well. They also control leverage and spread risk across assets. This method changes how money flows through the market.
As institutional participation grows, market swings look different. Sudden spikes still happen, yet longer trends carry more weight. Moreover, capital tends to stay in place longer. The overall tone appears more measured than in past cycles.
FTX Collapse Altered Investor Behavior
The collapse of FTX in 2022 marked a turning point. Bitcoin dropped roughly 78% from $69,000 to about $15,700 in November. That decline shook confidence across the sector. Many investors reconsidered how they managed risk.
Novogratz viewed the episode as a deep break in trust. Afterward, firms strengthened internal reviews and oversight. Retail traders cut leverage and reassessed exposure. At the same time, calls for transparency grew louder.
The fallout still shapes decisions today. Investors now pay closer attention to balance sheets. They examine counterparties before committing funds. Risk awareness remains higher than before the collapse.
October Liquidations Exposed Fragile Momentum
Another shock hit the market on October 10. A wave of liquidations swept through major tokens. The move forced many retail traders and some market makers out. Selling pressure rose without a clear external trigger.
Novogratz said traders struggled to identify a single cause. The absence of a clear catalyst fueled confusion. Forced selling then deepened losses across exchanges. Weak retail participation slowed any immediate rebound.
He stressed that narratives often guide crypto cycles. These stories take time to build interest and attract capital. When heavy liquidations remove participants, recovery takes longer. Momentum does not return overnight.
Novogratz expects speculation to remain part of crypto markets. However, he believes attention will shift toward real-world use cases. He pointed to tokenized real-world assets as a likely driver of growth. He also said lawmakers show support for the CLARITY Act, which could bring clearer market structure rules.
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