Michael van de Poppe disagreed with the widespread view among crypto investors that bitcoin will crash hard and altcoins will capitulate before a major surge. The analyst admits that many altcoins remain in a downtrend as of May 2021. This is the longest bearish trend in the crypto market that has lasted for over two years, but there is nothing to be surprised about it. This is the market’s reaction to the attacks suffered by blockchain projects in 2022, the bankruptcies of cryptocurrency lenders, including the collapse of crypto exchange FTX, the expert reminds.
To prevent further risks, governments are attempting to intervene in the regulatory framework to protect investors. Recently, the U.S. Securities and Exchange Commission (SEC) sued crypto exchange Binance, and the U.S. Department of Justice began investigating the platform’s activities. Despite the authorities’ good intentions, this jeopardizes the entire cryptocurrency ecosystem, the analyst said;
Meanwhile, the TradFi sector is filing to launch cryptocurrency ETFs and has even launched a trading platform EDX Markets, which has been good for the bitcoin exchange rate.
Van de Popp believes the declining sentiment among cryptocurrency traders and investors is “rooted in history”. There are a lot of people who survived the first bear cycle and entered the market in 2021. For them, even a slow loss of money feels extremely painful and they hope to at least maintain the value of their portfolio. These people are making assumptions based only on historical data, and that’s wrong, the expert said.
The analyst gave the real estate markets as an example: if it s been growing for forty years in a row, people will say everywhere and everywhere that buying your own real estate is a wise decision. But just because real estate has gone up in price for forty years in a row doesn’t mean it will continue to do so. Every moment in time holds new trading and investment opportunities, along with its own risks, the trader reasoned. The same principle applies to cryptocurrencies as well. Most altcoins have been on a downward trend for 18-24 consecutive months. Bitcoin is paired with bitcoin at cycle lows, but that doesn’t mean it will fall further, Popp believes.
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“We are in the second stage of capitulation. It’s a boring phase where you may feel like nothing is happening in the markets at all, and it feels like you need to move away from cryptocurrencies to other markets. What can I say: be patient and build up your position. If big financial companies are entering the crypto market, the wisest thing you can do is to follow them,” the expert concludes.
Recently, an analyst suggested that bitcoin could soon cross the $41 000 mark. Earlier, Popp said bitcoin’s rise could also be helped by the banking crisis.