Bitcoin Stabilizes Under $4,300
After a monumental rebound early this week, which sent Bitcoin (BTC) above $4,300 after weeks of dismal selling pressure, while altcoins followed close behind, the cryptocurrency market at large has found a sense of stability. As the time of writing, the aggregate value of all crypto assets amounts to $138.5 billion, backed by a respectable $17.3 billion in trading (past 24 hours).
BTC, which has become the focus of mainstream financial media in recent weeks, sits at a casual $4,290, failing to surmount and maintain a position above $4,300. However, the asset has still posted a gain of 2.75% in the past day, while failing to show any signs of foraying below $4,000 for the umpteenth time in weeks.
XRP, the native asset of the Ripple ecosystem, is up a mere 0.17%, finding itself slightly above $0.380 a pop. Ethereum (ETH) has seen a slight gain, posting a 1% move higher to situate itself just under the $120 level of supposed resistance. From a holistic perspective, the rest of the cryptocurrency market has undergone a similar move, posting slight single-percent gains as BTC stagnates above $4,200.
However, as normal, there have been a few notable outliers.
ZCash (ZEC), for example, is up a hefty 11.11%, as news broke that the popular privacy-centric asset was going to be added to Coinbase Pro, the exchange’s professional platform. Following ZEC’s addition on Coinbase, Stellar Lumens (XLM) saw its own mini bull run, now up 7.7% in the past day as investors anticipate its eventual listing on the aforementioned exchange.
Bullish Breakout Has Yet To Come, Bitcoin And Altcoins May Continue To Suffer
While bitcoin stabilizing above $4,200, an assumed line of support, is evidently a bullish sign, many aren’t convinced that BTC’s in the clear, or not yet anyway.
Fred Wilson, a well-respected venture capitalist who thrived through the Dotcom Boom and Bust, recently took to his world-renowned personal blog to define bear markets for emerging industries. Referencing his multiple decades of experience in nascent markets, Wilson noted that while the recent performance of crypto assets is “cringe” inducing, investors would be remiss not to step back and breathe in some fresh air.
Utilizing the age-old comparison that relates the early-stage Internet and current crypto ecosystem, the New York City native expressed that during the Dotcom Boom, Amazon (AMAZ) fell from a high at $90 to $6 in months, a jaw-dropping decline of 93%. Expressing this statistic’s relation to cryptocurrency markets, Wilson wrote:
“But for those of us who were investing in tech and tech startups back in 1999-2002, that time will forever be etched in our minds. It was a brutal period during which our belief in the Internet and its potential was sorely tested.”
And although he seemed hesitant to express the following sentiment, the prominent investor added that keeping AMAZ’s dismal historical drawdown in mind, Bitcoin under $4,000 could only be a precursor to lower lows.
Michael Bucella echoed this claim on CNBC Fast Money. The BlockTower Capital Partner told Fast Money’s panel that crypto’s recent liquidity dry spell, along with the presence of market volatility, can indicate that Bitcoin isn’t finished the end of its “distress cycle” yet, but is darn nearing it.
The former Goldman Sachs Canada executive, referencing Bitcoin’s historical price action, went on to point out that the last leg of crypto bear markets are normally the most volatile, yet short-lived. And while he was reluctant to forecast the level that Bitcoin will bottom at, Bucella explained that when the digital asset bottoms, whether it be at $2,000, $3,000, or otherwise, viable buying opportunities will be scant.
Still, there’s evidently a silver lining, as Wilson concluded his aforementioned blog post on a metaphorical high note.
The long-time tech entrepreneur wrote:
“I think some crypto asset (and possibly a number of crypto assets) will have a price chart like Amazon’s current one in 18 years. But we will have to do what Amazon did, hunker down and build value and survive, for quite a while to get there. And I think things will get worse before they get better.”
Bucella also echoed this optimism, noting that the “smartest money is [still] moving in,” and Bitcoin remains a bargain, even if it has yet to find its true long-term bottom.