Meltem Demirors, the Chief Strategic Officer of Coinshares, recently appeared on CNBC’s Fast Money to speak about the drop in the price of Bitcoin [BTC] recently. She spoke about the possible reasons for the drop to have occurred, and also spoke about the market in general. She also provided an outlook for the near future in the cryptocurrency space.
Demirors spoke about the sideways movement seen from the past 6 months, stating that it has led to a “number of events that piled up”, causing a mass release in the form of a massive sell-off. She elaborated:
“We had six months of Bitcoin and a lot about other assets trading sideways. I think there were just a number of events that piled up that led to this mass release to sell-off. It happened this morning around 10:00 a.m. Eastern Time. My view’s probably some institutions some funds deleveraging taking some money off the table.”
She went on to say that this was the way things tend to trade around the time of the fork, with individuals trying to take some risk off the table. This is also in preparation of the launch of Bakkt in December, mentioned Demirors, elaborating that this will offer institutions the opportunity for investing in Bitcoin. She drew parallels to last year, stating:
“[Bakkt will] offer institutional Bitcoin trading services to start. That’s a positive catalyst we saw this last year with the futures that started trading in November. Those were the major catalysts that led to bitcoins run to $20,000. In January we’ll see Fidelity’s new crypto custody arm starting to operate so as they add new clients maybe we’ll see some of this institutional money actually materialized.”
Demirors stated that she thought that Bitcoin is the asset that has held its strength and is over 50% market dominance, with all other assets in the midst of a “liquidity crisis”. She went on to say:
“What we’re seeing across the board is asset prices are down 75% or more in some cases 95%. Over 80% of the assets in the market today had less than 10 million dollars monthly trading volume, [and are] really thinly traded.”
This has led to her deciding that there is “basically no activity” on these project, going on to say that this is a point where these projects are running out of money. She said:
“They’re gonna need to start firing employees. They’re gonna need to cut costs. We’re gonna see consolidation and some of these assets inevitably will get marked to zero.”
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