The Crypto Spring Might Soon Come, As the Bear Reaches Its Bottom
Recently, as the crypto market has remained sluggish, both retail and institutional investors are on tenterhooks. Some analysts argue that the market liquidity will be even worse in 2023, and we will witness a series of negative incidents, including the bankruptcy of companies and institutions. As the market further declines, regulators have set eyes on crypto.
FTX founder SBF was arrested in the Bahamas in late 2022. Meanwhile, the U.S. Department of Justice claimed that Binance has also been on its radar for four years. Following that revelation, the net withdrawals on Binance reached a staggering $1.14 billion, and the USDC withdrawal was even temporarily suspended.
As the west is veiled in rain, the east enjoys the sunshine. On the same day, CSOP launched the first Bitcoin and Ethereum ETFs in Asia. Meanwhile, the spot prices of Bitcoin and Ethereum are trending upward, despite the high FUD (Fear, Uncertainty, Doubt) brought by Binance.
Market trends might be changing. We can clearly tell that the bubbles and excessive leverage in crypto have been almost eliminated. If that is the case, will the crypto spring soon arrive?
Looking back, investors will find that each bull market was started by a black swan event that triggered extensive market panic. Of course, factors including the global market liquidity also played a role.
In 2017, China’s nationwide ban on crypto transactions happened overnight. Back then, the market was going through an ICO craze, and it seemed that all projects could raise substantial funds with just one whitepaper and roadshow. However, the sudden crypto ban imposed by the Chinese government dealt a heavy blow to investor confidence and the crypto user base, which was small in 2017. Meanwhile, the top crypto exchanges also moved their offices away from mainland China due to policy reasons.
Following that, the BTC price soared, peaking at almost $20,000, and investors have never seen bitcoins sold at $2,800 again ever since. When China banned crypto, the U.S. monetary policy was loose, and the global market liquidity surged due to the excessive monetary supply. Meanwhile, players focusing on crypto tapped into the market bottom, and massive funds were funneled into the crypto space, which turned the market from bearish to bullish.
History never repeats itself, but it does often rhyme. As the crypto market plummeted on March 12, 2020, the BTC price was cut by half, and many altcoins fell by 90%, a black swan event that also seriously hurt regular investors. Meanwhile, the world economy gradually went off the rails due to the impact of the COVID-19 pandemic — the U.S. stock market melted down, and market indicators turned technically bearish. People across the globe shout that they just witnessed history.
Later on, the United States turned on the money printer to stabilize the economy as they did in 2017, which drove up the global market liquidity once again. Thanks to the QE policy of the U.S., global markets, including crypto, thrived, and the BTC price peaked at $69,000, a new high.
During the two previous bull markets, many companies stood out, but only a few of them have made it to this day. Only the best players survived the market reshuffle. Among them is CoinEx, a world-renowned exchange that’s now celebrating its fifth anniversary.
Founded in December 2017, CoinEx has also gone through multiple market cycles. It has always put users first and built a trading environment with easy-to-use, convenient products, services, and markets. As a global crypto exchange under ViaBTC Group, CoinEx has listed 600+ premium cryptos and 1,000+ trading pairs, offering secure, satisfying services to over 4 million users across more than 200 countries and regions. In 2022, the exchange also upgraded its slogan to “Making Crypto Trading Easier”. As a crypto company that has been running for five years, CoinEx is one of the few stable platforms in such a volatile market.
According to past experience, if the market wishes to turn bullish, perhaps a large-scale “accident” is needed. Although institutions like 3AC and FTX fell, their impact is limited. Furthermore, the market trends have already started to change, and the global market liquidity remains tight. It seems like we still need to wait patiently for the crypto spring. The good news is that for the Fed, there isn’t much room left for more hikes, and the crypto market will rebound once the rate hikes end.
Disclaimer: No investment advice is provided in this article, and all data mentioned herein are for reference only. You should not rely on the information provided herein to make any investment decision, and you will be fully liable for your own investment decisions.
