This week has been a little bit crazy on the markets, but it isn’t over. We should at least be grateful that crypto is never boring, right?
Thomas Perfumo, Kraken’s Head of Strategy, was kind enough to answer my questions about the market given its volatility.
Perfumo’s pullback is consistent with his view of the ” “new normal” Bitcoin has surpassed $100k.
“We’ve seen a couple of pullbacks corresponding with large liquidations of leveraged positions. This is typical consolidation behavior,” I heard him tell me.
“From observations during the past two cycles, a rally in altcoins takes hold after a run-up in bitcoin. This sparks a rotation into altcoins as investors seek to outperform in the next phase of the bull market. In the prior two bitcoin-led cycles, the market cycle peak corresponded with bitcoin market cap dominance, which is currently in the mid-50s, falling closer to 40%,” Perfumo, a new fragrance that supports what Empire has been talking about.
Perfumo predicts that altcoins will continue to perform well. “pick-up in interest”
“People are on the lookout for signs that crypto services are experiencing mainstream adoption. Stablecoins have already broken prior records in terms of circulating supply and DeFi total value locked (TVL) is inching closer to peak 2021 levels. We think the combination of significant improvements to scalability this past cycle and a line of sight towards a more favorable, pro-growth agenda for crypto innovation will lead to an environment that’s ripe for crypto services to catalyze a new wave of adoption.”
It’s time, I warned yesterday, to get ready for the lower levels of liquidity that are expected during this holiday season. Perfumo said that the US might put some selling off until the New Year, as they are focusing on potential tax implications.
“It’s certainly possible that shortfalls in liquidity could lead to higher price volatility, both to the upside or to the downside,” “He said”
Perfumo is in complete agreement with Canary Capital’s Steven McClurg when it comes to next year. The cycle has more legs than ever.
It’s not just bitcoin posting wins, he noted that DEXs and some infrastructure plays — which have received plenty of support from venture capital — are ready to post wins on the year.
While some sectors are ready for mainstream attention, others, such as web3, gaming, and the Metaverse, have not quite arrived. We’re honest. They aren’t ready.
Perfumo says that it’s possible for projects to be overlooked, but there are still dark horses.
It doesn’t matter, either way, the man is bullish about the environment. He tells me this is the ideal recipe for innovative thinking in space.
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