BlockTower Capital executive says Bitcoin is still in a young stage
- The General Partner at BlockTower Capital; has stated that Bitcoin is still young.
- The executive has attributed this to the ongoing market volatility.
- The price of Bitcoin is close to hitting yearly lows.
The cryptocurrency market has recorded major price dips over the past few weeks. The entire market has dropped by nearly half since it peaked in November last year, with the crypto market capitalization standing at around $1.52 trillion.
Bitcoin (BTC/USD) has fallen by around 50% from its all-time high, and it is currently at risk of erasing its year-to-date gains. However, according to the General Partner of BlockTower Capital, Michael Bucella, Bitcoin is still a young asset class.
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Bitcoin is still in growth mode
During an interview with CNBC, Bucella noted that Bitcoin was still in the growth mode. He noted that large-scale investors were using the dip as an opportunity to buy back in despite the market volatility.
Bucella noted that the volatility in Bitcoin and the entire cryptocurrency was not unexpected, given that it was still a young asset class. He added that the current dip was attributed to the false breakout over the past year that was not sustainable. “There was a lot of value creation that outshined the fundamental growth,” Bucella stated.
Bucella also noted that the crypto market volatility was attractive to players in the crypto hedge market. These institutions have become active due to this volatility. The executive also noted that this volatility was similar to new IPOs whose values spiked as they were still young.
Market spooked by possible Fed announcement
The recent volatility has been experienced across the financial markets. While the crypto space has recorded the most dip, other asset classes have also made some losses, which has been attributed to the highly-anticipated announcement by the US Federal Reserve.
The Federal Reserve is holding talks this Wednesday to discuss the monetary policy. The meeting has been attributed to concerns about the rising rates of inflation. Some of the measures expected to be announced include raising the interest rates to curb this. The announcement by the regulatory body has caused anxiety in the crypto market, given that the November bulls were attributed to the growing adoption of Bitcoin as a store of value. A possible Bitcoin mining ban in Russia is also attributed to the downtrend.