Cryptocurrency venture capital firm Placeholder partner Chris Burniske analyzes this week’s crash and believes that it does not show signs of the end of the cycle, but rather a mid-bull market pullback similar to the one in April to June 2021. He remains confident in the future market.
After experiencing a significant crash on Monday, with Bitcoin falling below $92,000, Bitcoin briefly surged above $100,000 after the release of mixed US non-farm payrolls data on Friday night. However, with Trump’s announcement of imposing tariffs on more countries next week, it fell 4.5% to a low of $95,601 before settling at $96,213, with a 24-hour decrease of about 0.6%.
Ether (ETH) also experienced a similar rise and fall, reaching over $2,797 before dropping 8.4% to $2,562 and settling at $2,629, with a 24-hour decrease of over 3%.
Chris Burniske, a partner at Placeholder, believes that this week’s crash is not a sign of the cycle top, but rather a mid-bull market pullback. He compares it to the pullback in April to June 2021, where various tokens plummeted by 50-80%, leading many to believe it was over, but the market experienced a surge in the second half of 2021.
Analyst Jason Yanowitz from Empire also suggests that the current cycle may still be in its early stages, excluding Strategy’s Bitcoin holdings. He believes that Strategy’s support has kept the Bitcoin price higher, and without Michael Saylor’s company buying over $20 billion worth of Bitcoin, the price would be much lower. However, he points out that there hasn’t been a significant influx of venture capital yet, and the market still remains in a “very PvP” state. Venture capital will be a key indicator for the arrival of the altcoin season.
As for Ethereum, it has not been able to surpass its previous all-time high of $4,878 from the last bull market and has been hovering below $2,700 due to recent controversies. However, an article from Coindesk suggests that the price trend of ETH is similar to when it bottomed out in August last year, indicating a potential upcoming rally.
The increase in trading volume suggests that the selling pressure may have peaked earlier this week, resulting in fewer potential sellers in the market. This may help stabilize prices and lay the foundation for a rebound. In August 2020, ETH experienced significant volatility, dropping to around $2,100, but then stabilizing in the range of $2,200 to $2,800 and eventually surging to $4,100 by the end of the year.
Jake Ostrovskis, an over-the-counter trader at Wintermute, also noted strong off-exchange demand for ETH, particularly in the case of a fund liquidation due to weekend volatility. In the options market, Deribit exchange has seen large bullish call spreads, including buying call options with a strike price of $3,500 and selling call options with a strike price of $5,000, both expiring on December 26, 2025.
In conclusion, the analysis suggests that the current market situation is not indicative of the end of the cycle, but rather a mid-bull market pullback. The potential for a rebound and the arrival of the altcoin season is still present, although the market is waiting for more venture capital investment to confirm this.