While investors were wondering when the bear market would end, a report published by the analytics company Glassnode sat on the agenda.
Glassnode Pointed To the Previous 3 Bear Markets! Big Reset!
According to on-chain analytics provider Glassnode, a major ‘reset’ is coming to the market. In its weekly report dated December 5, the firm said that the FTX collapse caused “one of the largest leverage crises in the history of cryptocurrency”. December Nov Bitcoin has been consolidating in a narrow range since the collapse of the FTX in early November. There was also a slight increase in on-chain activity. However, according to current data, there is no catalyst that will trigger larger price increases yet. In its latest report, Glassnode investigated the magnitude of the losses that took place during the leverage crisis.
The resulting sales are nothing new in the cryptocurrency market, and the removal of overly leveraged positions is healthier for the price in the long run. Its high leverage is generally unsustainable for any asset class. June November and November this year saw two capitulation events on a historic scale. The latest FTX event resulted in a record loss of $4.43 billion in one day, according to Glassnode.
However, the June sales, triggered by the collapse of the Terra ecosystem, led to daily losses of over $ 700 million for two weeks. Glassnode examined the ratio between realized profit and realized loss and noted that it had Decelerated to an all-time low. This suggests that the losses are 14 times greater than the profits. According to the report, similar-sized collapses occurred at the cycle bottoms of the bear markets of 2011, 2015 and 2018. After such a large selling pressure in 2011, 2015 and 2018, the trend in the market changed, and an exciting bull market began the following year.
As a result, Glassnode points out that there is a bull cycle after the big reset event. The report concluded that the magnitude of the losses has decreased following the crisis in recent weeks. According to the report, consolidation in the market is likely to continue for several more months.
While the crypto currency market has lost 1.1% in the last 24 hours, the total market value has fallen to 892 billion dollars. Bitcoin has fallen from the level of $17,400 in the last 24 hours and is currently trading at $17,024. According to this CoinGecko, Ethereum, on the other hand, fell by 2% to $ 1,266. According to analysts, several factors can also affect the bottom level of the market and the trend change. The US Fed’s abandonment of its hawkish stance could mean lower and fewer interest rate hikes next year. This could be good news for risky assets such as technology shares and crypto money, which have taken a big hit.
However, it is too early for the bull market. According to experts, in order for BTC to return to its former heyday, the FTX crisis must end and macroeconomic conditions return to normal. One of the most important elements in this process is the re-entry of corporate investment into the market.
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