The crypto bear market could take another 8 months: Greyscale

The crypto bear market could take another 8 months: Greyscale

The markets for cryptocurrencies have recovered last week, but digital asset manager Grayscale investments assumes that the bear market could last for another eight months.

cryptocurrencies as well as traditional economic and financial markets have changing cycles, the Grayscale researchers Matt Maximo and Michael Zhao wrote in a rel = "Nofollow noopener" Target = "_ Blank" href = "https://grayscale.com/wp-content/uploads/2022/07/bear-markets-in-persperspective-final-designed.pdf published on Monday.

You compared the current state of the industry with earlier bear market cycles and predicted that there could be another 250 days with "high -quality purchase opportunities".

Maximo and Zhao said that the current bear market cycle on June 13th began when the “realized price” of Bitcoin (BTC) fell below the market price. The realized price is derived by calculating the sum of all BTC at your purchase price by the number of BTC in circulation. Bitcoin can expect another 5 to 6 months downwards or sideways movement, they added.

The Grayscale researchers also found that crypto market cycles take about 4 years from the climax to the low point. The current cycle - the 2020 started - was about 1,198 days on July 12th.

Compared to previous cycles, Bitcoin needed the longest (952 days) this time to reach its climax, which implies that the next rally to record heights will take longer, says Maximo and Zhao.

"The 2020 cycle seems to have had a longer run in the ATH area (all-time high) with two extended tips, in contrast to the strong increase and waste in previous cycles," they wrote. "This could be due to the growing maturity of the cryptom market that did not exist in previous cycles."

market cycle 2020 a "story of leverage"

According to Grayscale, government spending in response to Coronavirus pandemic caused investors to start the leverage or use of debt for trade. But her positions began to dissolve after the Federal Reserve increased interest rates to combat inflation.

The report pointed out the collapse of the Stablecoin Terrausd (VAT), the delay in the fusion of Ethereum and a lack of transparency among centralized finances and hedge funds as reasons that tightened the sale of the market. And yet Grayscale believes that every market cycle will make the asset class stronger.

"The price of digital assets is only part of the broader ecosystem that develops in the crypto industry," wrote the researchers.

"During Bitcoin's price during market uncertainty besides traditional financial investments, the underlying network continues to work as planned and is well on the way to processing almost $ 18 trillion this year, compared to $ 13 trillion in 2021."

bring the best crypto and findings of the day into your inbox every evening. .

The post-crypto bear market can take another 8 months: Grayscale is not a financial advice.