Just nine weeks ago, the crypto market fell off the face of a cliff.
Within 24 hours, from the peak to trough, the price of Bitcoin fell by more than 50% from ~$7,600 to $3,700. It was a move caused by a global liquidation event in all markets, triggered by a run for cash to respond to the economics of the outbreak of COVID-19.
As the prices of crypto assets were plunging, investors were calling it quits. There were some saying that Bitcoin was on its way to $1,000 and lower, while billions of dollars of wealth were liquidated, forcing companies and funds out of business. It was a mess, and no one knew what was coming next.
Although a damaging move, a prominent investor recently remarked that the crash was a “nuclear bomb” with a big silver lining.
The Crypto Crash Left Bulls With a “Strong Foundation”
Speaking to Anthony Pompliano, co-founder of Morgan Creek Digital, in a recent interview, Ikigai Asset Management’s Travis Kling asserted that the March 12th crypto crash was a “nuclear bomb”:
“The leverage situation was very untenable rolling into ‘Black Thursday’. Down 50% in 24 hours — that was a nuclear bomb event for the market structure of Bitcoin. I can just tell you that without getting into details.”
While a nuclear bomb in real life leaves landscapes decimated, Kling said that there was a silver lining created by the proverbial explosion.
The crash forced out the weak hands and the leveraged traders, the Ikigai CIO explained, giving Bitcoin a “strong foundation” as it has rallied higher towards $10,000 over the past few weeks.
That’s to say: since the crypto crash wiped out a majority of the short-term speculators and put Bitcoin into the hands of long-term investors, the cryptocurrency market now has more fuel to rally sustainably.
Prepare for More Upside
With the strong base that’s building under the Bitcoin price, a pressing question arises: can BTC and the rest of the crypto market continue to rally higher from here? And if so,…