Duncan, a cryptocurrency expert (@FloodCapital), recently said that Bitcoin’s market has bottomed out and it is on its way to new record highs. He’s analysis, posted on X (formerly Twitter), offers a thorough examination of current market dynamics as well as the fundamentals which indicate a positive turn in Bitcoin’s price and possibly other cryptocurrencies.
Bitcoin: Has the bottom been reached?
Duncan noted in his detailed analysis that over the past couple of weeks, the cryptomarket has underperformed compared to the stock market. This was an alarming trend until a crucial development concerning Mt. Gox. Duncan observed, “Yesterday’s Mt. Gox headline provided a reasonable explanation for the recent market behavior.” Insiders anticipated the distribution of Bitcoin to creditors in billions. This led to a temporary drop on the market.
Related Reading
Alex Thorn is the head of research at Galaxy Digital. He analyzed and discussed in great detail what was happening. suggested This event may not have the impact on sales that was initially thought. Duncan explained. “We’ve swept the range lows, leading to about $300M in long liquidations.” These figures, while significant, are not as large as the events of liquidation in March and in April where over $750M in liquidations were made in just three 24-hour intervals. The market is cooling, as evidenced by the reduced open interest in altcoins, a lower funding rate, and an option skew that’s less bullish.
Duncan noted that sentiments on Crypto Twitter are overwhelmingly negative. “literally the worst I’ve ever seen it,” Bitcoin is still less than 20 percent off of its previous highs, despite the fact that it’s not even close to being at those levels. It is due to the experiences of the crypto-natives, who after witnessing the altcoin surge outperforming Bitcoin in 2021 tried anticipating a pattern similar this year and were met with an entirely different market.
ETF development has had a significant impact on the influx of money into Bitcoin. Blackrock Applying for an ETF when Bitcoin is valued at 26,000 dollars in June 2023. The ETF’s approval and inflow of $14,3 billion marked a dramatic contrast from previous years when decentralized finance was dominant and altcoins were popular. “This year, the capital is heavily skewed towards Bitcoin, influenced by its perceived stability and the formal financial product structure of ETFs,” Duncan elaborates.
Related Reading
Duncan presented Blackrock’s strategy in the cryptospace from a fundamental perspective. “With $17 billion in IBIT and at a 25bps fee, Blackrock is poised to generate approximately $45 million annually from this ETF, indefinitely,” He stated. He said.
Duncan has also talked about the possible normalization of Bitcoin’s allocation to major investment portfolios. Duncan believes that this will drive future significant inflows. “If 1% becomes the global standard allocation to Bitcoin, we have a lot of inflows to go,” He suggested that a lack of such a budget could be perceived as an oversight in the future. He also added: “A great selling point from these firms is if you don’t have 1% in BTC your essentially short / underweight BTC. This begins to flip the career risk from owning BTC to not owning BTC, a massive paradigm shift.”
Ethereum and the Future of Altcoins
Duncan has expressed his optimism for Ethereum. US spot Ethereum ETFHe believes that the Bitcoin ETF could be more profitable due to its higher fees and possible revenue generated from stake. “Blackrock’s most successful product launch ever is likely to have a sequel with the Ethereum ETF, which could be even more profitable,” He predicted.
He criticised the low expectations currently surrounding the Ethereum ETF. This, he says, is due to misinformation that has been spread and an underestimation its impact. “The ETH ETF is likely a higher margin product for Blackrock, and adding staking could boost its profitability even further,” Duncan suggested that integration is a key factor in the success of real-world assets (RWA) The appeal of on-chain is enhanced by its use.
BTC was trading at $61,764 as of press time.
Featured Image created using DALLE and chart from TradingView.com
“This article is not financial advice.”
“Always do your own research before making any type of investment.”
“ItsDailyCrypto is not responsible for any activities you perform outside ItsDailyCrypto.”
Source: www.newsbtc.com