Skip to content Skip to sidebar Skip to footer

(Kitco News) – As the SEC sues crypto firms Genesis and Gemini and Binance comes under increasing scrutiny for its “lack of transparency”, Grayscale Bitcoin Trust (GBTC) will come under increasing pressure. In the “rare event” that Grayscale collapses, it would trigger a “bulk sell-off event” for Bitcoin, according to Scott Melker, host of The Wolf of All Streets podcast and crypto trader.

However, he was optimistic that companies like Valkyrie could “take over” Grayscale and run it more efficiently.

“The real problem for the crypto market, especially the Bitcoin market, is if contagion [spreads] to Grayscale and GBTC,” he said. “I don’t think that will happen…but in the rare event that something like GBTC needs to liquidate, we would see a massive Bitcoin sell-off event.

The past year has been bearish for cryptocurrencies, with the overall crypto market capitalization dropping from $2 trillion to $800 billion, according to CoinMarketCap. Melker predicted that there will be a lot of “sideways” trading in the crypto markets in 2023.

“I expect we’ll see more side hash as we see the macro giving us some clarity,” he said. “I don’t expect Bitcoin to skyrocket as the Fed continues to maintain its hawkish tone, and we don’t know what’s going on with other markets.”

However, he said that by 2024, an election year, “a bull market going” is likely.

Melker spoke with David Lin, presenter and producer at Kitco News.

Crypto Bear Market

The past year has seen the failure of a number of notable crypto firms, including Celsius, BlockFi, and FTX. Former FTX CEO Sam Bankman-Fried (SBF) is currently facing jail time for market manipulation.

Melker said that while more crypto exchange failures are possible, it won’t affect crypto in the long run.

“After seeing Celsius, Voyager, BlockFi, Three Arrows Capital, LUNA all go down, people said if we got one more, it was over,” he observed. “And there was nothing greater than the FTX [collapse]…and what happened? Bitcoin price crashed and is now trading higher than it was before the FTX debacle…the asset class has come back and continued to rise.”

Melker added, “When people start telling me that any asset is going to drop to zero, and start giving me irrational reasons, that usually means it’s time to buy.” .

With CeFi firms like FTX failing, Melker struck a positive note, suggesting that DeFi firms may see greater demand.

“Now that we’ve seen these centralized platforms fail, like FTX, there’s been a real movement back to the initial, original ethos of Bitcoin, which is not your keys, not your coins,” a- he points out. “There has been a massive movement over the past few months. Ledger in March abandons its new wallet [for example]… it’s a return to the ethics of decentralization and being your own bank. It could be the silver lining to everything that’s going on here.”

To find out if Melker thinks SBF was behind LUNA’s collapse, watch the video above.

Follow David Lin on Twitter: @davidlin_TV

Follow Kitco News on Twitter: @KitcoNewsNOW

Disclaimer: The opinions expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. This is not a solicitation to trade commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no responsibility for loss and/or damage resulting from the use of this publication.

Source link

Leave a comment