What has changed in the crypto market? In our LATOKEN review, let’s take a look at how the entry of institutions into the cryptocurrency world has impacted the crypto industry on the whole and why the current growth cycle has become unique. Read on!
Analyst Willy Woo predicted that the current bullish trend would continue for another year. However, the current growth cycle is in many ways different from similar past periods, the specialist says. According to Woo, over the past year, serious investors have come to the crypto market with more significant investments; they are focused on the long-term accumulation of digital assets. These factors indicate that the current growth cycle might be longer.
Is this theory justified? LATOKEN review
We can say that the words of Willy Woo make sense even without taking into account the entry into the market of institutional investors. The fact is that according to historical data, each subsequent growth cycle of Bitcoin was longer than the previous one, although there were only three of them.
Of course, another factor that speaks in favor of Willy Woo’s theory is the entry into the market of a significant number of institutional investors who have the resources to buy out large volumes to “average out” in the event of a depreciation.
Another factor in favor of Woo’s theory is the relocation of the market to the West in compliance with all the rules of the new jurisdiction. China’s policy on digital assets forced not only miners to leave the country but also provoked the departure of representative offices of big crypto exchanges and the outflow of “whales.”
It is likely that a regular increase in the trading volume of Bitcoin futures almost eliminates sharp and prolonged dips or ups. In the foreseeable future, thanks to this, the top 20 cryptos can begin to show returns comparable to the traditional stock market without high volatility. However, one cannot be entirely sure about such a scenario.
Has the change with the crypto market already taken place?
The current upward cycle of the digital asset market is clearly different from previous ones in terms of the rate of growth of Bitcoin. An example is the growth of the first cryptocurrency over the past three months from $29K to $67K (a rise in price by 131%). It can be assumed that this speed is based on the increased popularity and availability of Bitcoin as an investment asset, as well as the launch of new derivatives and funds.
On October 19, the first U.S. exchange-traded fund based on bitcoin futures began trading on the New York Stock Exchange (NYSE). Two days after the start of trading, the assets under the Bitcoin Strategy ETF of the ProShares company exceeded $1 billion. The fund broke the record for the growth rate to $1 billion, which was held for 18 years.
If at all it is possible to take into account the price dynamics of Bitcoin, then most likely, the peak of the current cycle will occur in the first half of next year. However, again, when dealing with cryptocurrencies, there is nothing to be sure of. What we can do is just wait and see.
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LATOKEN crypto exchange does not provide any investment, tax, legal, or accounting advice. This article is written for informational purposes only. Like other assets, cryptocurrency is subject to market risk. Please do your own research and trade with caution.
