According to the co-founder of a major cryptocurrency price-tracking company, the cryptocurrency bear market could be just getting started.
Bobby On, who is also the Chief Operating Officer of CoinGecko, said: say Cryptocurrencies are in the midst of a macro bearish market due to Russia’s invasion of Ukraine and supply chain problems that are causing constant inflation.
He said the Fed “has no choice” other than raising interest rates to quell inflation, and that growth stocks are taking a hit as a result.
“With institutional participation, crypto now correlates highly with TradFi. [traditional finance] It is considered a tech stock/risk-on asset and is taking a major hit. Many of the listed tech stocks have lost 75% of their market caps in the past six months. Are we near the floor?
Unfortunately, we are just the beginning of the Fed’s tightening cycle. The Fed will have to continue raising rates over the next few quarters to tame inflation, and more pain is coming. We told our team that we expect the next 12 to 18 months to be difficult.”
According to Ong, CoinGecko is preparing for an extended bear market.
“We are already in a bear market and it will not be in the short term. We need to prepare for difficult times, be prudent in spending, focus on optimizing revenue, and build what the community wants. It’s time to roll up your sleeves and BUIDL. [build] for the next cycle.”
Ong says many investors he knows are “cash heavy” right now.
“A lot of the investors I’ve met are cash-heavy right now. Arthur Hayes expects further disruption, with Bitcoin buyers at $20,000 and Ether buyers at $1,300. Time to choose your purchases very carefully and see them get stronger on the other side of the cycle!”
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