Bitcoin is already in its 'next bull market cycle' — Pantera Capital

BItcoin (BTC) is opening its “seventh bull cycle” and investors should not beryllium frightened of crypto post-FTX, Pantera Capital believes.

In its latest “Blockchain Letter” connected Feb. 8, the plus absorption firm’s CEO, Dan Morehead, predicted that 2023 would beryllium a “year for rebuilding trust.”

Morehead: Cryptoassets person "seen the lows" this cycle

With BTC terms enactment retracing somewhat aft gaining 40% successful January, immoderate marketplace participants inactive importune that caller macro lows are owed crossed crypto assets.

While the timing for specified a script varies, statement remains absent erstwhile it comes to however the marketplace volition rebound.

For Morehead, however, the clip to flip bullish connected crypto is already here.

“Pantera has been done 10 years of bitcoin cycles and I’ve traded done 35 years of akin cycles,” helium noted.

“I judge that blockchain assets person seen the lows and that we’re successful the adjacent bull marketplace rhythm – careless of what happens successful the interest-rate-sensitive plus classes.”

That position differs from the bulk successful casting speech the statement implicit crypto terms correlation with hazard assets specified arsenic equities. This, arsenic Cointelegraph continues to report, forms the backbone of immoderate different prognoses for 2023.

Morehead argued that the drawdown from Bitcoin’s latest all-time highs has placed the marketplace good wrong humanities context, contempt dipping beneath its erstwhile bull marketplace all-time precocious aft the FTX debacle began.

“The diminution from November 2021 to November 2022 was the median of the emblematic cycle. This is the lone carnivore marketplace to much than wholly hitch retired the erstwhile bull market. In this lawsuit giving backmost 136% of the erstwhile rally,” helium wrote alongside accompanying data.

“The median downdraft has been 307 days and the erstwhile carnivore marketplace was 376. The median drawdown has been a -73% downdraft and the latest carnivore marketplace ended astatine -77%.”

Going forward, a inclination alteration volition ensue, with Bitcoin connected its mode to caller grounds highs.

“I deliberation we’re done with that and opening to grind higher,” Morehead added.

Bitcoin terms cycles illustration (screenshot). Source: Pantera Capital

A "jurisdiction-by-jurisdiction" recovery

Similar optimism was meantime directed astatine the DeFi space, with Pantera nevertheless positioning for a twelvemonth of “rebuilding trust” successful centralized concern (CeFi) archetypal and foremost.

Related: Bitcoin terms taps 3-week lows arsenic SEC fears liquidate $250M of crypto longs

This would beryllium necessary, Morehead claimed, successful airy of past year’s aggregate firm failures, which precipitated the crypto carnivore market.

“2022 was a twelvemonth of booms and large busts, particularly arsenic it pertains to CeFi. In the span of a fewer months, the satellite saw Three Arrows Capital collapse, Do Kwon’s LUNA disintegrate, Voyager Digital spell bankrupt, and Sam Bankman-Fried’s (SBF) FTX empire shatter,” helium explained.

“What did each these events person successful common? The headlines similar to suggest that it was crypto oregon Web3 that failed. But, successful fact, it was a operation of atrocious actors skirting lines successful jurisdictions without wide regulations. If 2022 was the twelvemonth of breaking rules and failing, I judge 2023 is the twelvemonth that entities alternatively travel the rules and bask the rewards of doing so.”

While the Letter did not notation the existent regulatory battle involving the United States Securities and Exchange Commission (SEC), it foresaw CeFi reclaiming its clout worldwide “on a jurisdiction-by-jurisdiction level.”

The views, thoughts and opinions expressed present are the authors’ unsocial and bash not needfully bespeak oregon correspond the views and opinions of Cointelegraph.