All is not bleak in the cryptocurrency industry as it recovers from the repercussions of a tough week. For the first time in Bitcoin’s history, the price has fallen for nine consecutive weeks. Amid the upheaval, investors are wondering if the crypto is oversold.
since the beginning of the year, Bitcoin and Ethereum, along with the rest of the crypto market, have been crushed. Indeed, it was so horrific that Bitcoin set a new record for continuous price decline, with nine weeks of consecutive price declines.
Katherine Wood sheds light on bitcoin and current market sentiment
Cathie Wood, the founder and CIO of Ark Investment Management, recently appeared in an interview discussing Bitcoin and the current state of the market. Cathie has been a strong supporter of Bitcoin and Ethereum. During the discussion, she highlights how ARK Invest analysts are monitoring the current bear market and whether or not investors should be concerned.
“I would like to talk about bitcoin, as I indicated,” Wood added, “where we introduce bitcoin monthly, and I’m really excited about that because we think the market needs it.”
Bitcoin futures are currently selling at a discount to spot Bitcoin, according to the founder of Ark Invest.
Terra/Luna – The largest VSCrypto Fiasco
Everyone knows that Terra, the terra blockchain, blew up last month and Luna is worthless. At one point, the ecosystem’s total market capitalization was around $60 billion, and it had a number of well-known supporters. When Terra’s UST, one of the largest algorithmic stablecoins, lost its peg, the market exploded, wiping out nearly 2.7% of the crypto’s total market capitalization.
According to Cathie, everything in space was once unorganized, which is why the horrific disaster happened.
“While the systemic repercussions of Terra’s failure should not be overlooked, its influence on Bitcoin appears to have been limited.”
Wood also expects tougher cryptocurrency laws in the wake of the Terra LUNA/USD fiasco.
Bitcoin’s longest red streak ends
Besides Terra Collapse, another reason for Bitcoin’s downtrend could be due to the high correlation with the Nasdaq. However, in the past week, this correlation has broken down a bit.
The Nasdaq had a few very good days, but not Bitcoin. This is a concern for investors as Bitcoin is down 57% since hitting nearly $70,000 in November. Its 200-week moving average is $22,000 and is rising. It looks like after a long period of consolidation and corrections, Bitcoin is about to break in a bullish direction.
Short-term holders appear to have capitulated
Wood said in the interview that it looks like short-term investors can see everything in this ecosystem; the opening is incredible.
“Based on the metrics, these short-term holders have capitulated. This is great news to put a bottom on. At 65.7%, long-term investors are at an all-time high. This suggests they have Bitcoin in possession for at least a year. In other words, we have here extremely strong holders or holders. Although to identify the bottom, you could see a capitulation of the long-term holders.
With just under 66% of all bitcoin supply unchanged for over a year, bitcoin holders have never been so focused on the long term. Cathie Wood, says the holders have given up and if we haven’t put the bottom yet, we’re close. Previously, Cathie was one of the few people to correctly predict the bottom of the July stock market crash last year.
Is she right now? We will have to wait and see if Ark Invest releases any interesting on-chain data.