Crypto Unwrapped: Have Crypto Prices Found a Bottom?

In one of the most eventful weeks in #crypto market history, more companies reported having trouble staying afloat, and #Bitcoin and #Ethereum fell below some key psychological thresholds before recovering. Despite the decline, the number of addresses holding at least one ETH has hit an all-time high of over 1.5 million wallets, according to Watcher Guru. ???

?? Between the lines: Liquidity in the crypto space is a closed-loop system and the crypto market is entirely dependent on inflows from other systems. Santiago Vélez, Co-Founder and Research and Development Division Lead at Block Digital shared why this might not be such a terrible thing.?

• "The overall decline in valuations in the crypto market is largely due to the macroeconomic back trend.”??
• “This is a natural unwinding that clears up all the malinvestment. It's a process that we have to go through to emerge and take lessons learned.” ?
• Malinvestments are poorly allocated business investments due to artificially low cost of credit and an unsustainable increase in the money supply. They?inevitably lead to wasted?capital and economic losses.?
• FTX is emerging as a kingmaker after injecting $250 million worth of credit into BlockFi to shore up that position??

?? Transparency is key. “We’ve seen these problems before in centralized finance. They are just replicating themselves once again in the crypto markets.” Mona El Isa, Founder and CEO of Avantgarde Finance and Co-Founder of Enzyme explained.?

• Transparency is essential to regulating and maintaining a healthy market?
• “If Three Arrows Capital, Celsius, and others had been completed on a chain, they would have been a lot more transparent and things maybe would have panned out differently” Lisa suggested.?
• Three Arrows Capital has a license to run a fund of up to $250 million in assets under management; however, the FT reported that they were managing $4 to $10 billion, which implies that they had leverage ratios of 16 to 40 times.?
• Tether recently announced that they will be undertaking a full audit – not just an attestation – of stablecoin with one of the top 12 auditing firms.??

?? What to watch: For the first time, #USDC exceeds #USDT (#Tether) in terms of on-chain transactions on Ethereum?

• The rise of USDC could mean global investors are looking for more transparency during this period of increased volatility.

Want to watch the full analysis? Check it out on YouTube ??