Although the crypto market is going through a challenging phase, the core systems are functioning well, crypto-financial service provider Bitcoin Suisse’s Director Giles Keating told CNBC.
In an interview earlier today, Keating said the core blockchains of cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) are not facing any problems. He added that the recent market rout is a result of the collapse of the TerraUSD (UST) stablecoin and decentralized finance (DeFi) platforms.
Keating’s sentiments come after the crypto market crashed on Saturday, June 18, before correcting upwards on Sunday. The crash saw BTC trade below $17,800 before bouncing back. At press time, the flagship crypto is trading at $20,495.25.
On the other hand, ETH plunged below $900 on Saturday. Like BTC, the coin recovered its Saturday losses and is currently changing hands at $1,127.53.
Commenting on the crypto market’s performance over the weekend, Keating said the market is close to a point where some of the real excess leverage has exited the system and a bottom can now start forming.
Referring to yesterday’s double-digit gains in BTC and ETH, Keating said they signal the end of big liquidations in the crypto market.
Experts claim bears are not done with crypto
While Keating believes the crypto market is bottoming out, Valkyrie Investments CEO Leah Wald believes the nascent asset class is still in a bear market. In an interview with CNBC, Wald said BTC has found support just below $20,000.
According to her, it makes sense that BTC found support below $20,000 because this is the same level that most institutional investors onboarded the crypto bandwagon. She added that “these market participants” will do everything possible to prevent their trades from going underwater.
Wald said the recovery of the crypto space would probably take longer because confidence in the industry has been shaken.
She gave the example of crypto hedge fund Three Arrows Capital (3AC), which failed to meet margin calls, forcing lenders to liquidate it. Additionally, Wald spoke of Celsius – which appears to be insolvent – saying the platform’s impact is far-reaching because it was a lender to many retail and institutional investors.
Like Wald, Dan Ives, the Managing Director and Senior Equity Analyst at Wedbush Securities, believes the crypto winter is yet to end.
Speaking to the Financial Times, Ives said:
This is a dark winter ahead for crypto as the era of free money comes to an end with this weekend another brutal sell-off across the board. Risk assets are all getting thrown out the window.