August 5, 2024 - 6 Reasons for the Crypto Sell-Off
- Market decline: A 10% weekly crypto drop accelerated to 20-30% over the weekend, with traders assessing whether it's a buying opportunity or risk-off scenario.
- Key factors: Global macro pressures, Jump Trading's ETH liquidation, political shifts (Harris vs. Trump), and ETF flows are influencing the market, though most are seen as short-term disruptions.
- Minimal long-term risks: Global macro and supply overhangs appear temporary, while crypto's low correlation to equities and lack of long-term damage point to resilience.
- Buying the dip: With tokens down 50-75% from March highs, the selloff is viewed as a potential buying opportunity for those bullish on crypto's long-term outlook.
August 12, 2024 - The Crypto Investing Paradox
- August crypto selloff: A sharp drop in the market, driven by futures liquidations, cleared leverage and led to a strong recovery, with key signals like ETF inflows and reassurances from central banks supporting the rebound.
- Bitcoin as a "safe haven": Bitcoin is not a flight-to-quality asset during market selloffs, but instead shines when trust in governments or banks erodes, such as during banking crises or currency collapses.
- Crypto paradox: Despite the reliability of crypto protocols during market crises, few investors moved to on-chain platforms, as traditional assets like stocks remain more appealing to trade than crypto tokens.
- Blockchain's future: While blockchain technology holds promise for trading assets like stocks and bonds on-chain, mainstream adoption remains limited by the lack of appealing assets to trade within the crypto ecosystem.
August 19, 2024 - For How Long Can Crypto Lag?
- Market recovery after August 5th crash: Traditional markets, including equities and the VIX, have rebounded significantly from the August 5th lows, while crypto assets like BTC, ETH, and SOL remain lagging despite positive broader market trends.
- Fear trade fading: Indicators like the VIX and credit spreads show a sharp decline in market fear, but crypto markets remain in negative sentiment, as seen in the Crypto Fear and Greed Index and open interest measures.
- Crypto sentiment and positioning: Negative sentiment in crypto, low funding rates, and low speculative interest suggest caution, though these factors don't necessarily predict an immediate market recovery.
- Potential for a strong crypto rally: Despite the negative short-term technicals, positive news such as ETF inflows and institutional interest from firms like Morgan Stanley could signal a major rally if sentiment shifts.
August 26, 2024 - The Inevitable Rally With Some Greenshoots
- Low trading volumes but significant rally: Despite a quiet market with declining crypto exchange volumes (-16% WoW), major tokens like BTC, ETH, and SOL saw gains of 9%, 4%, and 11%, respectively, with mid-cap tokens posting even larger gains.
- Fed’s impact on the rally: Fed Chairman Powell’s Jackson Hole speech, signaling potential rate cuts, fueled the crypto rally, suggesting more upside movement might follow despite low liquidity.
- Crypto market dispersion and growth: For the first time since March, the market is showing signs of dispersion with tokens like Helium, Eschelon Prime, and Aave rising based on positive developments rather than market-wide movements.
- Caution on further rally momentum: Although BTC ETF inflows were strong, new capital remains limited, and significant inflows may not occur until after the U.S. presidential election, with the market expected to maintain an upward bias in the near term.
