Bitcoin and the crypto market are in a bear market since the peak in November 2021, but the question: "when will the bear market end?" is invalid, but for some reasons, it shouldn't be ignored though the question could be answered in two lines and this question is not also different from the likes of, "who you trust in crypto" well this could be a tough one.
The entire crypto market has been down while a handful of crypto firms becoming bankrupt like Voyager Digital who recently announced insolvency:
Voyager Digital has become the second high-profile crypto firm to file for bankruptcy in recent days, joining the Singapore-based Three Arrows Capital (3AC) in doing so.
The New York-based firm and its two affiliates, Voyager Digital LLC and Voyager Digital Holdings, took the step in the Southern District of New York late on Tuesday, according to a filing.
Per the document, Voyager had more than 100,000 creditors and between $1 and $10 billion in assets, with the same range for its liabilities.
Voyager’s stock plunged by 11.93% as the news broke.
Last month, the company revealed it had a $661 million exposure to 3AC, a crypto hedge fund that failed to meet margin calls from several lenders and eventually filed for bankruptcy on July 2.
“We strongly believe in the future of the industry but the prolonged volatility in the crypto markets, and the default of Three Arrows Capital, require us to take this decisive action,” Digital Voyager CEO Stephen Ehrlich said on Twitter.
This type of information is a major concern for the entire market and individual investors are asking: when will this cryptocurrency bear market end, and reclaim previous high prices. If you are not a trader, you're likely worried, about when will the market recover to be trending back towards all-time highs and eventually start breaking new all-time highs. Yep! You're not alone but to what it may sound, patience is key.
A lot of analysts are wrong in how they're calling the bottom of this bear market, with their fanning sophisticated tools. This crypto bear market doesn't deserve an expert to answer the one-millionth question. This question that's on top of every investor's mind saves them to revisit their investment goals. Because we've seen cryptocurrency prices trending downward for a very long time and the question that's likely discussed -when will a reversal start for a head back towards the all-time highs.
Here's how a lot of people are getting this wrong. There are a lot of wrong statistics out there measuring this market cycle. Forecasting the future during this market cycle is a risk due to low liquidity in the market, most buyers and sellers are almost exhausted.
Fundamentally, major macroeconomic conditions are downplaying the market such as rising inflation. Miners also dumbing millions of dollars in bitcoin to pay back their loans. Also, the terra luna crash like saga presumably will end, it is just a matter of time.
Technical analysis can not hold crypto price trends to forecast a reversal during this period of crypto bankruptcy, major VCs and firms had a greater impact in rallying the bull run. Market sentiments are downplaying most investors' interest which is a major pullback for most investors. An asset appreciates due to investors' interest given favourable sentiments. Also, Google trends for the term bitcoin are relatively low for the past five years which is a great impact.
Charting on to draw fancy lines while banking on subscription fees for technical analysis to predict the bottom pointing to a particular pattern that if bitcoin follows will predict a breakout while giving nose dive for fundamentals is terribly wrong during this market cycle.
Whatever the case in this bear market, hold on to your investment goals on your denying table. Remember, this cycle will be history by the end of this year. Forecasting the future is a great measure of an asset,s performance, but relating it passed performance could be misleading in short term.
The four-year cycle should be translated as a golden ghost, you are made to believe it's probably going to last a short amount of time based on the past? These narrative self-fulfilling prophecies that bitcoin halving forecast future price of bitcoin particularly in the last cycle is wrecked and has been invalidated a couple of times. And it's why people are not trusting this type of thesis blindly that bitcoin's halving every four years impacts its price. We can note events like halvings translate into sentiments to impact the price of bitcoin.
The fundamental reason why crypto is taking a nosedive since the beginning of this year could also be translated by the effects of the broader markets like the stock market. Because since the inception of ETPs (Exchange Traded Products) and ETFs into the crypto economy, bitcoin is then correlated with stocks. When the macroeconomic scene influences headwinds in stock it ultimately translates into the crypto market due to correlation. A correlation coefficient is a great tool for measuring the correlation between assets.
Resolutions of macro trends like central bank monetary policy to curb interest are reasonably favourable for the stock market and crypto definitely will start trending back toward its all-time highs if correlation plays out. Let alone the bankruptcy issues, when it all settles, the downplay impact will disappear and more entry levels will be favourable.
Nevertheless, investments are made under predefined conditions and could be revised during certain market conditions to an investor's interest. The market will recover sooner than later, play your odds accordingly whilst the bear market is still there. Whatever the case, staking sat below $20000 USD will be life-changing, because bitcoin is a revolution and the entire cryptocurrency industry is disrupting the tech world while changing the way humans will live in a digital economy and it's only getting better. Nonetheless, learning from the past is the keynote in building disruptive products, but predicting the future in developing technologies could be overwhelming. Fundamentally, the traits of bitcoin as a currency over fiat should be a golden opportunity to take on into the financial system.
Thank you for reading and I hope it's worth your time. As always, these are my views without any influence from third parties.
To you, what do you think about the crypto market during this downward trend? As always, your comment is welcomed.
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