Economist and trader Alex Krüger shared thoughts on the current state of the cryptocurrency market, pointing out what, according to his interpretation, is driving the current price action and why the bull market is not over yet.
What Happened: Krüger highlights Bitcoin BTC/USD ETF as the primary force behind the cycle, while Ethereum ETH/USD has been a “major disappointment” despite performing well for stakers and airdrop farmers.
He adds that Solana SOL/USD has established itself as the preferred chain for retail traders, demonstrating "perfect product-market fit" and even overtaking Ethereum. However, the network’s congestion and subsequent crashes have opened the door for competitors like Base to position themselves as viable alternatives for retail traders.
Noting the marginal new retail interest in crypto, Krüger states that most of the participants are ETF buyers and those from previous cycles redeploying their funds and taking on more risk. Those who missed the Bitcoin ETF run, crypto market participants with “PTSD (post-traumatic stress disorder),” went all-in on altcoins. But those disappointed with significant losses, as numerous altcoins erased their 2024 gains in the past month.
Why It Matters: While many meme coins have gone to zero, Krüger writes they have dominated the narrative alongside Bitcoin as large-cap meme coins are among the strongest performers of the year. They have also established themselves as "a viable asset class in their own right."
He attributed the market's volatility to the increasing presence of scammy meme coin launches and cash-grabbing founders mainly since February. These founders prioritize short-term hype and quick profits over long-term sustainability.
Krüger maintains that the current crypto cycle “is not over” and there are still numerous opportunities for investors who navigate the market carefully and stay attuned to the evolving trends and narratives.
This analysis comes amid Bitcoin's huge price plunge of 5% in a single day pushing prices below the $58,000 mark.
What’s Next: The influence of Bitcoin as an institutional asset class is expected to be thoroughly explored at Benzinga’s upcoming Future of Digital Assets event on Nov. 19.
This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Image: Shutterstock
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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