Cryptocurrency mega-thread

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Yellow Feathers said:
I'm almost fully allocated again. Mostly BTC and ETH and keeping it simple this cycle unless a new narrative arrives.

One bold prediction I have is that NFTs will run again. They couldn't be held in lower regard then they are now, everyone hates them and considers them dead. But I've been looking at a few of the quality projects - don't own them (can't afford it) but it's interesting.

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Chromie Squiggles.

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Pudgy Penguins.

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Wonky Stonks.

Pretty good performance for a bear market.
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I agree wholeheartedly with this sentiment man. I'm going to wait for the Federal Reserve meeting on the 1st of February (in particular the month following said meeting) as I believe the entire market will take a dip, and it's then that I'm going to buy up some ENJIN, MANA and SAND.
 

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WaywardSonSon said:
I agree wholeheartedly with this sentiment man. I'm going to wait for the Federal Reserve meeting on the 1st of February (in particular the month following said meeting) as I believe the entire market will take a dip, and it's then that I'm going to buy up some ENJIN, MANA and SAND.
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Nice
I have sand but not much at all tbh
My last non btc or eth buy was algorand which I will now hodl for at least 5
 
WaywardSonSon said:
I agree wholeheartedly with this sentiment man. I'm going to wait for the Federal Reserve meeting on the 1st of February (in particular the month following said meeting) as I believe the entire market will take a dip, and it's then that I'm going to buy up some ENJIN, MANA and SAND.
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Absolutely! The meta verse tokens have performed well recently - a very good sign.
There’s clues everywhere, just need to be open to them.
 
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Excuse Me What GIF
 
Zevon said:
Don’t worry. They’ll be back when it crashes down to US $100k having peaked at 3 times that :$
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They're good at finding bottoms.

Caesar was posting nonsense about leverage as a reason we wouldn't go up when we were at 17k, and that seemed like a good enough reason to buy.
 

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For anyone interested in understanding liquidity, these are both good charts to gauge it for TradFi and crypto (all in USD as it’s the dominant market). As Ted mentions, there was a spike for TradFi last week (about 400B), but this hasn’t flowed into crypto yet. Liquidity in the markets is down over 1T since the peak in 2020/2021, but is starting to recover this year. Recent upticks in crypto are stemming largely from shorts squeezing, rather than any increase in spot demand.

If you go back to the start of 2020, you can see how quickly liquidity spiked in TradFi markets (as we know the money printer was on and interest rates at zero), which obviously triggered major bull runs in all markets. You can then see this start to reverse in 2022, especially towards April/May.

A good article explaining what ‘market liquidity’ actually is: Teach Me Daddy | BitMEX Blog
 
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BobbyMorri said:
We could keep posting if you like.

Why did it go up 5% or whatever? Any reason outside "emotion" or sheep following sheep.
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I like having some opposition here whether we're pumping or dumping. Not sure how others feel about it though.

My thoughts as to why we pumped:
1) Some large entities in the space have recently crashed and burned, which often forms the basis for final capitulation.
2) Sentiment was horrible. Everyone who wanted to sell had sold. Bull and bear markets start on buyer and seller exhaustion. When there's nobody left to sell, number goes up. Fwiw I expect the road to be rocky from here while believing we've bottomed.
3) Bitcoin at <20k USD and ETH at <1k USD are undervalued.
 
evolved2 said:
I like having some opposition here whether we're pumping or dumping. Not sure how others feel about it though.

My thoughts as to why we pumped:
1) Some large entities in the space have recently crashed and burned, which often forms the basis for final capitulation.
2) Sentiment was horrible. Everyone who wanted to sell had sold. Bull and bear markets start on buyer and seller exhaustion. When there's nobody left to sell, number goes up. Fwiw I expect the road to be rocky from here while believing we've bottomed.
3) Bitcoin at <20k USD and ETH at <1k USD are undervalued.
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4) those buying bulk now and causing the price to jump will be the ones who get out before others are left holding the can.....
5) rinse & repeat
 
FRUMPY said:
4) those buying bulk now and causing the price to jump will be the ones who get out before others are left holding the can.....
5) rinse & repeat
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We just had our first higher high since 2021. That's a sign of strength.

vWZyRWLU
 
BACCS said:


For anyone interested in understanding liquidity, these are both good charts to gauge it for TradFi and crypto (all in USD as it’s the dominant market). As Ted mentions, there was a spike for TradFi last week (about 400B), but this hasn’t flowed into crypto yet. Liquidity in the markets is down over 1T since the peak in 2020/2021, but is starting to recover this year. Recent upticks in crypto are stemming largely from shorts squeezing, rather than any increase in spot demand.

If you go back to the start of 2020, you can see how quickly liquidity spiked in TradFi markets (as we know the money printer was on and interest rates at zero), which obviously triggered major bull runs in all markets. You can then see this start to reverse in 2022, especially towards April/May.

A good article explaining what ‘market liquidity’ actually is: Teach Me Daddy | BitMEX Blog
Click to expand...

Expanding on this a bit by using the BTC weekly chart since the start of 2020. As you can see highlighted at the start of 2020, US Fed Net Liquidity in the market (bottom chart) increased from $4T to $6T in the few months just after the COVID crash (it would eventually reach over $7T in 2021 and stay at this level for over 6 months).

However, this only started to really hit the crypto market in late 2020 and into 2021, where you can see stablecoin supplies going from ~$20B in October 2020 to ~$100B during the first peak in April 2021 (BTC went from $10k to $65k) and peaking just under $160B during the 2nd peak in November 2021.

In late 2022, the Fed started to suck liquidity from the market, which is when financial markets started to trend down sharply. There was a mini recovery early in 2022, but this was quickly halted in April as liquidity took another leg down. Net Liquidity appears to form a double bottom at ~$5.5T in the last few months of 2022, before starting to trend back up again and reclaim the 20 EMA this month.

Stablecoin supplies are down about 20% from the peak, with no reversal apparent yet. However, it appears to have steadied at these levels since late 2022, coinciding with a less hawkish Fed and increasing liquidity. The recent positive price action as I explained in my post above appears to be largely from shorts squeezing/longs opening with liquidity already in the market, not an increase in spot demand.

All signs and comments coming from the Fed indicate that inflation has peaked in the US and rate hikes may pause in the early part of this year, with potential cuts starting again in 2024. This would obviously be great for crypto in the lead up to the BTC halving in March 2024, so fingers crossed!

This is another Twitter thread that I recently came across which explains 'Net Liquidity' well:


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