This Monday (9), the main cryptocurrencies of the market operate in the red, with weekly drops above 10%, with the exception of stablecoins.
THE Bitcoin (BTC) fell below U$ 31 thousand, and the Ether (ETH) at $2,300, both cryptocurrencies are about 50% below their all-time high.
According to André Franco, chief analyst at the Bitcoin Market, it is possible that bitcoin will continue to decline, and approach $20,000.
For him, the macro scenario is the “big culprit”, but there are still fundamentalist crypto-asset metrics that point to optimism.
The downward movement began after the announcement of the Federal Reserve (Fed) to increase the interest rate in the United States.
For Orlando Telles, founding partner of Mercurius Crypto, even if the fall remains sharp, the crypto market is reaching records in numbers of developers and venture capital investors.
Bitcoin (BTC) falls on its back and breaks its tooth
André Franco makes an analogy of this fall in the market with football:
“The phrase ‘classic is classic and vice versa’ is one of those that only those in the middle understand. In addition to this, one of the most striking phrases for me is “when the phase is bad, the guy falls on his back and breaks his tooth”, he says.
According to Franco, in addition to defining the bad phase of a player or a team, it also defines the current moment of the macro market and, consequently, the crypto market.
“The week the fedthe American central bank, decided to follow the guideline for raising the interest rate, the market on the day of this decision responded well, with an increase, but the following days were of falls”, he explains.
This is because, for him, the expectation that at this rate of interest rate increase the fed will not be able to control american inflation became the narrative in force.
“Consequently, not even the good news moved the pointer up, a typical moment of falling markets, in which positive news doesn’t help and sometimes even hinders, like falling on your back and breaking your teeth.”
THE crypto marketguided by bitcoinfollows the same path and falling as risk assets around the world depreciate, as he says.
“As much as we see some very positive metrics in bitcoin, the moment is to really expect more drops, being able to go below 30 thousand dollars and approach 20 thousand dollars.”
However, Franco comments that there are still positive metrics in relation to greater cryptocurrency in the world by market capitalization.
“If we were totally price agnostic, I would say that the metrics of the bitcoin have never been so positive. Long-term (LTH) investors continue to accumulate bitcoin and we are at the highest and most positive point of this metric, as you can see below.”
Who’s Afraid of Bitcoin (BTC)?
The Fear and Greed Index, which measures investors’ fear of the market, is showing extreme fear.
However, Orlando Telles says that the reason for the drop remains the macro factor. As he explains, in 30 days, bitcoin achieved the highest correlation with Nasdaq in history.
“For me, this is one of the best times to be positioned in crypto when thinking in terms of fundamentals. Six months ago, the market reached the highest number of developers in the market, and we are also reaching the highest inflow of ‘venture capital’ [capital de risco] of history in the last six months”, explains
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