Afford.Capital: Market Wrap #4

When it may seem that nothing is interesting about being in the flat market, there is still a lot of insightful data to absorb. Being abreast of what’s happening behind the scenes leads to a better understanding of the current market situation and sentiment. Let’s dig in ??

What’s happening with crypto markets?

According to the leading crypto traders, the fall from 40.000 took place without corrections to the resistance zone, and as long as we are above a significant support zone (All-Time High 2017), the long priority remains.

Also, we analyzed a new weekly review on crypto markets by Glassnode. What are the key takeaways from it?

• Despite the currently ongoing mess and turmoil in traditional markets, BTC is holding up pretty well.?
• The trading range of $18,000 -20,000 has been going on for 4 months already, which is quite a rare occurrence for BTC. It may indicate the likelihood of a quick return of volatility to the whole market.
• The cumulative average breakeven price for BTC miners is just below current levels. A fall below this level could lead to severe stress in the market, which, therefore, could lead to a new wave of miner capitulation in the market.

Nomics Research: 12,000+ cryptocurrencies have almost stopped their trading activities this year. This is 3 times more compared to 2021. Many projects are not dead yet, however, their tokens are not traded due to lack of interest.

That's why it is essential to invest in carefully vetted projects and startups only. Afford.Capital has a unique scoring system with 200+ parameters inside, so we are sure that our portfolio startups and investors are safe and sound.

What is the situation with asset flows & inflows in crypto?

According to the weekly report by Coinshares on financial flows into crypto products, we can spot an insignificant inflow: +$10.3M. During this week we see:

• BTC-based crypto products: +$7.7M
• ETH-oriented crypto products: +$5.6M

However, if we check the Cryptorank research with fundraising in the crypto industry by quarters, we can spot a sharp drop in Q3. The number of transactions and the amounts in $bln have been decreasing. While you might be scared while seeing this, our DAO venture fund is happy to become even more active in the investing field, finding new awesome deals. But let's dig deeper...

The money flowing out of crypto-related funds in Q3 has slowed down, Most probably this is a sign that many bearish investors may have already piled out of the risky asset class.

What's more, the Kaiko research shows that crypto markets performed way better compared to the traditional ones in Q3.

Quote of the week??

BitMEX CEO: “According to our observations, institutional demand for everything related to crypto is only growing - despite the bear market”