Open Book with Anthony Scaramucci - Prediction Markets, Trump's Federal Reserve, Bitcoin Back to $100K, & MicroStrategy

Episode Date: December 8, 2025

I am excited to share this conversation with my good friend and investor, Michael Novogratz, to discuss the latest in the state of the markets. We are experimenting with a new format, so please send us your feedback if you have any. This conversation strips away the pretense around Bitcoin's volatility, MicroStrategy's leveraged gamble, and the mainstreaming of speculation with two Wall Street veterans who've traded through every crash and euphoria. From forced liquidation fears to prediction markets disrupting casinos and the slow invasion of crypto into trillion-dollar wealth channels, it's a blunt, unvarnished look at how risk, regulation, and the normalization of gambling are reshaping markets right now. 📚Mentioned in this episode: The Little Book of Bitcoin by Anthony Scaramucci The Wisdom of Crowds by James Surowiecki Dow 36,000 by James Glassman & Kevin Hassett Michael Novogratz is the Founder and CEO of Galaxy Digital. He was formerly a Partner and President of Fortress Investment Group LLC. Mr. Novogratz served on the New York Federal Reserve’s Investment Advisory Committee on Financial Markets from 2012 to 2015. He serves as the Chairman of The Bail Project and has made criminal justice reform a focus of his family’s foundation. Follow Anthony on X: https://x.com/Scaramucci Follow Novo on X: https://x.com/novogratz Anthony Scaramucci is the founder and managing partner of SkyBridge, a global alternative investment firm, and founder and chairman of SALT, a global thought leadership forum and venture studio. Learn more about your ad choices. Visit podcastchoices.com/adchoices

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It's part of consumption, as part of joy. I don't think it's a good thing per se, but it's a thing. And you see it in meme coin investing. You see it in same-day options. It was illegal to bet on elections in America. That's why Shane got rated. Well, should it be illegal? Yes or no.

The people say, let me bet on anything I want to bet. My fucking money, I got to do with what I want. If Bitcoin ends next year at 140, it's going to mostly because you've seen this U.S. wealth. Like a 3% allocation is a trillion and a half dollars. It's a lot of wealth. And so if it starts moving, you could see that change. the trajectory, but in the short run, we still have this overhang of treasury companies and the fact

that people thought it should be a lot higher this year. It's not. God forbid that you and I should be in the U.S. Senate, but let's say you and I were in the Senate, would you be worried about that? You see, for people listening at home, what Michael just did was he folded his hands in body language of great defense because he does not want to be in the Senate or anywhere near there. Okay, so go ahead. What would you say? What would you be worried about? Welcome to Open Book. I am your host, Anthony Scaramucci, and sort of a bonus editions of Open Book,

I decided to bring in a very dear friend of mine, 30-year friend, Mike Novagrats, who was a partner at Goldman Sachs. We worked there together. Went on to become the macro trader and one of the founders of Fortress, and now is the founding CEO of Galaxy, which is a phenomenal cryptocurrency trading shop.

Mike and I have spent a lot of time together privately talking about markets, and I thought it would be interesting to share some of his and my insights for you. I hope you guys will enjoy this conversation. In today's show, we're going to be talking about the crypto environment, the acceleration in Bitcoin and other things crypto last week, but also the macro environment, who the next Fed chair is going to be. And then after the break, Mike and I are going to talk about the prediction markets and the impact. that these markets have on the overall markets. And some of the things are going to be happening in the future, Mike and I are going to try to predict that. Hello and welcome with me, Anthony Scaramucci and I am Mike Novagrots.

All right, Mike, we're back. What a great show last week. Great conversation. And so we had a crypto rally caught me by surprise. I don't know if it caught you by surprise, but what happened? Give us some insight. I think there was a tremendous amount of fear. in the market around micro strategy.

You know, people don't understand exactly the sailors' strategy. And they started fudding this idea that at one point he's going to be a force seller of Bitcoin to pay off his prefers and his

and his perpetuals. And I think the strategy team got together and said, let's put enough cash on the sideline for the next two years that we can make every payment that we have in a cash reserve. So it's the first time he had a cash reserve. So what was about a $1.4 billion? Is that right?

Yeah, $1.4 billion, which is his you know payments coming due, you know, on coupons. And he can then just sit. And there was a spectacular volume day. You know, so they, what you call it, key day reversal in trading is monster volume. The market starts down and ends up. And so I think in the short run, the micro strategy fear went away and that allowed the market to breathe. Like, oh, my God, it's not the end of the world. It doesn't mean crypto's out of the woods. You know, when you look at

a chart, crypto Bitcoin really has to get back above 100 and stay above 100 for, you know, a week or two for it to feel safe again, right? Big money. money is made in trend. And you can define trend by the 20 day, the 50 day, the 100 day moving average. When you're below all three, it's kind of super trend. When you're above all three, it's super trend bullish. And, you know, we're below all three in crypto right now. And we're below this line at 100 where lots of the volume happened above. And so that's going to act as a ceiling for a while. It doesn't mean we will get through it. You know, Bitcoin is a funny, funny instrument and there's a real narrative for it. And you're also seeing real money people start

to buy. But when I say real money, the wealth channels of America, right? RIAs, registered investment advisors manage about $45 trillion, mostly for older people of wealth. It's the single largest block of wealth. And you're seeing Bank of America, J.P. Morgan, Van Gogh, all these big institutions saying, hey, my salespeople can now sell Bitcoin, which is very different than you're allowed to buy Bitcoin. We can now sell it. And you're seeing buying there. And if Bitcoin ends next year at 140, it's going to mostly be because you've seen this U.S. wealth. Like a 3% allocation is a trillion and a half dollars.

Like it's a lot of wealth. And so if it starts moving, you could see that change the trajectory. But in the short run, we still have this overhang of the treasury companies and the fact that people thought it should be a lot higher this year. It's not. So let's stay on micro strategy. We've got a lot of young listeners. So I'll just be brief on this. What Michael Saylor did was he converted his software company effectively into a Bitcoin accumulation company.

His attitude is Bitcoin is the operating layer of the future of money. And so he's a software company. This is unbelievable technology. And currently he owns about 3% of the overall network. But there's fear there that if there is too much volatility, he'll get forced into this vicious cycle where he has to cascade sell. You're telling people right now, I'm hearing you correctly, he's built up a two-year reserve where his preferreds, all the debt that he took on to buy this Bitcoin, those coupons get paid. is that enough? Or is there something you would be worried about?

Play analyst. I know you love Michael Saylor. He's a very close friend of mine, wrote the foreword for my Bitcoin book. I like him as well. But is that enough, Mike? I think it's enough in the short run. If you know, Michael, you know his fundamental belief Bitcoin's going higher. Listen, if something would happen and Bitcoin doesn't go higher and it goes down to 30,000 or 20,000,

Yeah. Micro Strategy is not going to be a very good stock down. You know, we're going to change the name to Skybridge, the low bridge or blown up bridge. Okay. So I'm going to help galaxy either, as we all know. No. Part of the bet that shareholders in micro strategy have made is that Bitcoin goes higher. You're now basically trading at parity to the Bitcoin that it has, you know, when you adjust for debt and everything else. And so now it feels more like an ETF. Listen, there were tons of people, me included originally, when he had this strategy that was trading at a big premium, said, it can't last and it's got to go to become just a quillum to an ETF, unless he can do something really creative. His creativity, which was real creativity, was he found a way for people to believe in him, sell Bitcoin at a premium, use that to buy more Bitcoin for the,

Existing shareholders they benefited for the new shareholders. They needed new people to come in. And so you got a lot of the last group of his shareholders are underwater. And so, you know, most of them are probably going to hold and ride the Bitcoin train. Some will sell for taxes and some will sell just because they're like, enough of this. I think he will have a hard time reigniting that flywheel. But I think micro strategy can trade as a closed end fund, you know, for a long, long time, without having to sell any Bitcoin, it might trade at a 10% discount or even a small premium. And so, it, all these treasury companies are now in the same position. Micro Strategy at least has a ton of volume every day.

Like, it'll trade $2 billion of volume today. Like to put that in perspective, Galaxy, which is a $10,9 billion company, will trade $250 million today. So they're trading it more volume than the ETFs. Most of the other Dats, other than Tom Lee's BNMR, trade with almost no volume. And so you've got this collection of kind of closed-end funds. And closed-end funds normally trade at a 10 to 20% discount. And it just becomes less exciting of a story. Why it's important for crypto is because for three months, that was the vehicle that was

bringing new capital into our space. It doesn't have to be a disaster for the space. It's just going to be dead money. And so for crypto to have its next leg up, you need new sources of capital. And that's either going to be wealth or it's going to be some retail frenzy that shows up again out of Asia or out of somewhere. And we haven't seen it. I'm going to throw a fact set at you. It's a little bit of a hypothetical, but I want you to, you know, I want you to stay with me, agree or disagree. So if I'm sitting here, let's say I landed from Mars, I came out of my Age of Disclosure, alien spacecraft, and I'm looking at this market, I'm saying, okay, there's a transition that's taking place. You know, the way venture capitalists bought Google, then they

went public, and now you have institutional and retail holders. There's a transition taking place. Galaxy participated in a nine-plus billion dollar sale of Bitcoin for an OG holder earlier in the year, there's been billions of dollars that have transitioned from Wales in Bitcoin into ETFs into the institutional market. And lo and behold, we learn from Bank of America and Vanguard that to your point, they're able to sell it. But you know Wall Street. I know Wall Street. One thing we both know about Wall Street, it's a selling machine, Michael. And so I'm looking forward. I'm saying 26, there's going to be a lot of demand because Wall Street, you know this.

These are products that are sold, not necessarily bought. Wall Street's going to be out there with this product. Do I have that wrong? Yeah, that's the exact setup. And it's just a question of how fast that machine gets going. And, you know, it's easy to sell things that are going higher. I mean, it's hard to sell things that are going lower. And so you've got to base and get a little bit of positive momentum.

I use that level as 100. If you get about 100, 105, there's going to be the FOMO machine. Oh my God, I should have bought it at 85. I should have bought it at 90. I should have bought it at 92. And then you're going to really see the acceleration. But it might take us, you know, a few months to get through that. We might go lower first.

We might go, you know, I'd like to think 80 was the short-term low. You know, I would say volumes are down 30 to 35%. And a lot of this still comes, and we talked a little bit this last week, comes from that Black Friday, as the crypto guys were calling it, when you had these wild drops and a lot of punters. And remember, crypto are crypto investors like a lot of leverage, and a lot of them got wiped out. And so you wiped out a lot of market makers and a lot of participants.

And I always say humpy-dumpty cracks. It takes more than a week to put them back together again. No question. He always gets put back together again because paychecks come in, Dad gives you money, inheritances, and people have more money to start putting in the markets. But it just takes time. And we're at a lull right now. So before we go to our break, I want to switch gears to macro.

I had breakfast this morning with two very astute macro people bringing up the thesis about the Fed. And even though we may be in a late cycle stock market wise, I don't know if you agree with that or not, but it feels like we could be in a late cycle. There's a lot of room here because the Fed is going to have a rate-cut friendly Federal Reserve chairman. And knowing Donald Trump as well as I do, and I think you know him pretty well, I expect him to flood capital into the system in an attempt to win the midterms. He certainly doesn't want to lose the midterms. And so these two governmental forces are going to push the market higher in the first half of next year.

Is that your view? Do you have a different view? What would you be worried about? So that's becoming consensus, which worries me a little bit. But I think he's going to pick Hassett. I think Hacett's going to be very dullish. He's going to do the president's bidding. But stop there and go back, Michael, for people that are learning about markets,

why when you say consensus, does it worry you a little bit? Because everyone's in the trade, right? Yeah, because people all believe the same thing right now. Now, sometimes that doesn't matter because once it happens, things crack. If you want to look at the most interesting chart of the day, and not everyone has this ability to chart, but if you look at the 30-year interest rate or the future on the 30-year interest rate, so on Bloomberg it would be USHC or GT30 or just the 30-year bond on Yahoo,

the pattern looks like what you call a head and shoulder. And when those things break, it's a big leg down. almost like when crypto went under 100, it goes pretty fast to the next level down. If bonds go a little bit higher in yield or lower in price, you could see kind of a cascading effect. And we've seen that in Japan with their bond market. And that's usually a, you know, a canary in the coal mine, so to speak, right? So you're having confidence breakdown that central banks plus ministry of finances are going to be able to keep confidence in the long end of the yield curve.

So that's not good for risk markets. And so the bonds really start breaking down. We've got to be careful. Again, why picking a Fed governor who has the respect of the market who will fight for the Fed independence is all because of the bond market. if you pick, you know, a guy who just does whatever the president wants, you could see the bond market break down and that's a real problem for people. And so I, so you think it's going to be Kevin Hassard. So it might not be Hassard because if this bond market breaks in the next 10 days and that's all you hear about, Donald Trump, as you know, you know much better than I know. I just watch him. He's a man that could change his mind in an instant. If he's got a bond market that's crapping itself, you're going to have Scott Besson in his ear saying, you know, you might want to go with Kevin Warsh.

You might want to go with Rick Reeder, someone who Wall Street trusts. Because all you got is the bond market. Right. Okay. So when you've got 39 trillion of debt. Okay. So your opinion, though, okay? I have my own opinion, which I'll share in a second, but your opinion, Hasser is what?

Is he too Trump connected and Trump dependent? Would he be data dependent like a reader or war? I think he will be Trump. He will do Trump's bidding. At least I think the market will proceed him. Now, he might start off trying to act very independent, but people aren't going to buy it. You know, people don't remember this about Kevin. But in the year 2000 with James Glassman, who was an economic advisor to the first George Bush,

they wrote a book called Dow 45,000. And this was a sensationalist book, 25 years. Remember the book? Sensationalist book 25 years. ago. And so he's always been a permable and he's always been for lower rates. I don't know if Trump knows that he wrote that book, but he is triggered on lower rates. So it'll be interesting to see if that happens. And of course, the Dow did get the $45,000. We're now trading at $48,000, but it took 25 years, Michael. So before we take, before we take the break, though, you believe that

it will be him. If you, because we're going to get to the prediction, markets in a second after the break. We'll talk about the fascination with those. But if you were a betting man right now, I think because I think Trump really wants to have control. I think it's dangerous, right? The last president that took control of his own central bank in a big country was President Erdogan Turkey and the next year they had 86% inflation. Like it normally doesn't end well. Like we have independent central banks for a reason. You know, what's scary, Anthony, is if you look at the last, any of the last 10 cabinet meetings. But there was one, I think, two days ago, two and a half hour cabinet meeting. And they televised them. And each cabinet secretary

goes around and praises, you know, the commander in chief. You gave that leadership and we're going to do it. Thanks to your leadership. That's why everyone with your leadership, congressional Republicans under the president's leadership, under your leadership. Thanks to your leadership. Under your leadership, Mr. President. under your leadership. Under your leadership, all because of your vision leadership. Just appreciate your leadership, Mr. President,

and empowering us to be able to conduct this service. Merry Christmas. Donald Trump is the most visionary leader I've ever seen. And this performative deifying of the president, which just plays right into Trump's smile, is dangerous. It feels like North Korea. And so HACIS is in that circle right now.

And I don't know. He could surprise us all if he's got the gumption to say, no, no, no, no, Mr. President. You're just the point of me, I'm doing my job the way I'm supposed to do it. We're going to take a break. We come back from the break, Michael. We're going to talk about the prediction markets, Shane Copeland, Polymarket, CalC. We'll talk a little bit about their impact on the overall markets. We'll be right back after the break.

Welcome back from the break. I'm Anthony Scaramucci. And I'm Mike Novagrass. So Michael, we've got this whole new phenomena that's happening now. I'm surprised it didn't happen earlier, by the way, but we have prediction markets. We've had things like CalC and Polly Market. And we have all these different websites that we can go to now. And I can bet whether or not the Yankees are going to fire their manager. I can bet whether or not. Kevin Hassert, who we were talking about prior to the break, is going to be the Fed chair, literally anything. But I have been impressed with these markets because I feel like they have uncanny predictive ability. Now, let's go back to the 2024 campaign for president, you know, on Polly Market. It was 70% that Donald Trump will win the election. And he won it. So let's step back for me.

There was a book, oh, God, by it like a pseudo-economist. and he talked about the power of crowds and he could put a cow up in front of people in a thousand people right down the weight of the cow and the average of the crowd would get the cow within a pound or how many jelly beans in the jar like there is a there is a genius in large numbers

and that's what prediction markets bring us to because of information Michael right because there's generally the collection of those people there's like a James Surawiki about 15 years ago who wrote a book called The Wisdom of Crowds. I mean, that's the book I was talking about. Yeah, yeah. So there's the wisdom of crowds. I probably shouldn't call James a pseudo-economist, but, you know.

Okay. All right. He's not going to be a fan. He's going to be super happy to you and I brought up his book from 15 years ago. But the wisdom of crowds suggests that there's a lot of information in the marketplace. And those betting markets will analyze that information for you in terms of its average of what the info is. You believe that. I do. And listen, I think they've done a pretty good job in predicting lots of things. You know, the story of prediction markets here is interesting,

though, because I met Shane when he was starting his business in Soho. He might be the only guy in our industry that has fancier jackets than I do. And so, you know, he, I'm going to tell him that you said that, actually. He'll be, I mean, that's a huge compliment from you. I don't think anybody has fancier jackets than you. So we had a stick going and, you know, I look back, I wish I had invested. I didn't. He, you know, he had a long haul. He, while he was able to raise capital and people really believed in him, it was not an easy

path for him, including, you know, having his office raided by the FBI, what has been so unique in the last six months and both of these things are now raising money, both Calcian and Pollymarket raising money over $10 billion. million dollars out of nowhere was the regulatory mind shift that came in with the Trump administration said, oh, no, these things aren't illegal. It's a new way of looking at things and we'll let you be regulated, broadly unregulated, right? It's a CFDC product. And people like, what? And if you're a casino that has spent hundreds of millions. millions of dollars on compliance and regulation and getting your people approved, or if you're a

sports betting organization, if it's draft kings or fanatics or any of those giant sports betting platforms, you're saying, this is unfair. Like, we have this huge overhead and huge burden of compliance at these prediction markets don't. And the government's kind of saying, tough luck. You know? And so these guys, guys have wings in their sales, I think you're going to see it is a very disruptive business in sports betting, in markets. No, listen, you will see lobbying fight back. You know, defy decentralized finance, you know, permissionless systems is the crypto equivalent to the prediction market in the sense that it will give those platforms like hyperliquid or

uniswap huge advantages over traditional exchanges because of the same compliance stuff. And you saw Ken Griffin going down to D.C. today saying, no, no, that's not fair. Right. So the incumbents are going to try to protect their space. And the biggest risk to Calci and polymarket isn't them being able to get customers and create great product. It's the lobbyists that are going to try to change the rules on them and say this is not fair because they've got an advantage. I mean, I got to ask you this question because I think what people are worried about from a regulatory perspective, there was a reason why there was regulatory suppression of this stuff because, you know, you were, you could make, you know, bets on the election, but people were profiting. You could make a bet on a hurricane. Hurricane's going to do damage to New Orleans, and you could win on that. And there was, there's, there's opinion-based things. And then there's also things that somebody could potentially unduly influence. You saw the Google. There was an article today.

that a Google engineer was delaying the Google results by a certain amount of time and then gambling on polymarket and, you know, make a whole bunch of money. He was rigging the system. So are you worried about that? Let's say you and I were in the Senate. God forbid that you and I should be in the U.S. Senate. But let's say you and I were in the Senate, which would be worried about that? And you see, for people listening at home, what Michael just did was he folded his hands in body language of great defense because he does not want to be in the Senate. Senate or anywhere near there. Okay. So go ahead. What would you, what would you say? What would you be

worried about? Listen, there's a, it's a great question. There is this balance between the Democratic side likes to protect the consumer and sometimes they way overdo it. The Republican side has a buyer beware. You know, listen, if it's disclosed, you're a big boy, go do it. And I come out probably not right in the middle, probably a little right of the middle on this. stuff, I think humans are smart. I think they learn quickly. That said, I think we need far better disclosures and we need fair, we need fair set of rules. And so that Google engineer, what was written about is true, should get prosecuted and thrown in, and find and thrown in the clink, or at least have some severe penalty. And so,

you could have markets that are free to operate in, right? You don't have to be a certain wealth to participate, right? Like we could have open access to people, but we need a much, much better disclosure regimen. And there's got to be a process. And with AI, it should be doable. where markets do get monitored for irregularities. And, you know, it's very complicated, Michael,

but this is a $10 billion market now. But the estimate is in five years, it could be as high as $400 billion. It could, in a Super Bowl case, go to a trillion. Do you believe that, Mike? Well, what I talked about, I think, I was this last week with you or maybe I was on stage. When you and I were teenagers, we would watch movies and gamblers were perceived as

gangsters, bad guys. Or you could go to Atlantic City. It was pretty seedy place or Vegas. It was the only place the prostitution was legal, right? You know, it had this seediness to gambling. It was kind of the bad guy thing. It was illegal to bet on sports in America. Like, in most countries, gambling was illegal.

and we have now normalized speculating and gambling. It was unthinkable to have sports teams in Vegas when you and I were teenagers. Remember it? It was like, can't have a sports team in Vegas that would potentially root a sport team. Now you've got you've got gambling being normalized as part of life. It's part of consumption as part of joy. And again, I don't think it's a good thing per se, but it's a thing. And you see it in meme coin investing.

you see it and you see it in same-day options. I got a son-in-law who's an awesome meme coin trader. I've got a cook, a chef, that does same-day options, right? Like everyone around my space, my son loves sports betting. And they got the, everyone, every kid between 20, every male kid between 22 and 30 or 16 and 30 understands what a parlay is. Right. And so this is just taking that, giving it another form and making some kind of, of you can do politics, right? It was illegal to bet on elections in America. That's why Shane got

rated. Well, should it be illegal? Or yes or no? And I think the people say, let me bet on anything I want to bet. My money, I got to do it with what I want. And, you know, the morality of a country has to say, yeah, we don't think it's good. Or we think it's good if you're 25 years old or over. or, you know, like, that's what countries get to come decide and decide what their morality is. And right now, the morality of most countries are let them gamble. One last question before we go, Mike. I'm looking at our economic dashboard here. And I want you to, this is like quick questions to say up, down, or maybe.

So Bitcoin and crypto in a healing phase, you think we'll have another down draft? Do you think we're consolidating here? Up down or maybe. I think consolidating. I think it's a harder decision here in the next eight weeks. My gut is it grinds higher, but I'm not positive. I think over a 12-month period, we will be much higher than here. Rates.

Rates are going lower. I think the yield term is going to continue to steepen, which means the two-year rate is going to grind lower. And the long bond is going to grind higher. And I worry, the biggest worrying sign would be if the 30-year rate starts falling at a increasing rate, right? Right now it's still just all kind of grinding around and the curve is steepening. But the twos versus 30s, let's say it's roughly 125 basis points. If that thing is 175 in six weeks, that's a problem. All right.

Listen, it's a great, another great show this week. We hope you guys will join us again next week. Mike, thanks for joining the show. And I'm going to see you in Abu Dhabi, right? We're heading to Abu Dhabi. Here we come. All right. God bless.

Be well. See you soon. Guys, thanks for joining us today on the show. Send us questions at info at scaramucci.net. And we'll answer them next time.