The probability of "both long and short explosions, heaven and earth needle" market is increasing

王哥爱吃香菜 · 2023-06-26T04:43:39.000Z

I personally don’t think today’s rise has much to do with institutional entry into cryptocurrencies. It is more likely to be related to the entry of Russian mercenary Wagner into Russia. This is due to the increase in "risk aversion" sentiment towards buying cryptocurrencies due to panic in the shadow of war. At the 22nd Annual Meeting of the Bank for International Settlements, a representative of the European Central Bank spoke. We can get a rough idea of Europe's current attitude towards the encryption industry. They believe: Cryptocurrencies have become speculative assets and a means to circumvent capital controls, sanctions or financial regulations, and some participants believed that cryptocurrencies are a form of gambling.

I personally do not think that today's surge has much to do with the entry of institutions into the cryptocurrency market. It is more likely to be related to the entry of Russian mercenary Wagner into Russia. The panic caused by the shadow of war led to the increase in the "risk-averse" sentiment of buying cryptocurrencies.
At the 22nd Annual Meeting of the Bank for International Settlements, representatives of the European Central Bank gave us a general understanding of Europe’s current attitude towards the crypto industry.
They believe that cryptocurrencies have become speculative assets and a means to circumvent capital controls, sanctions or financial regulation, and some participants believe that cryptocurrencies are a form of gambling.
This statement reflects that the EU's regulatory strategy for cryptocurrencies may be further upgraded. I don't think I need to say more about what the crypto industry means by losing banking support. MICA 3.0 may also be "released" soon, and crypto exchanges such as Binance that conduct business in Europe, which are in the "vortex" of regulation, may also become the "target of public criticism" in the European market.
Regarding the recent investment of new institutions in crypto assets, I personally think that it is more likely to be short-term behavior or in the form of "custodial management". Because the relevant laws and regulations on cryptocurrencies have not been implemented, rash entry will face greater unknown risks.
On the 25th, a speech from BlackRock executive Joseph Chalom largely summarized the current status of institutional crypto investment, that is, only after KYC (real-name system) and anti-money laundering practices are accepted and implemented in DeFi, will blockchain technology be truly adopted in institutions. (If institutions don’t know who they are trading with, they will go to jail)
The "delayed" establishment of relevant regulations has greatly slowed down the entry process of institutions and the rise of the crypto market.
Data on the 25th showed that the amount of open interest in Bitcoin contracts hit a year-on-year high, and the total amount of open interest in Bitcoin derivatives has now exceeded US$14 billion.
According to the data provided by the exchange, the BTC contract long-short ratio is 0.87, with a short advantage. However, the BTC contract on the entire network shows a long advantage.
This shows that most retail investors are still bearish, while large investors are leveraging their bullish advantage with larger funds or high leverage. As a result, short sellers should be extra careful, because in theory, retail investors will still be the ones who get hurt.
It is worth noting that the open interest of BTC contracts has been above $10 billion for nearly three and a half months. Will capital allow investors to "unscrupulously amass wealth"?
Personally, I believe that this trend of high contract leverage is intentional by "capital". When it reaches a certain critical value, a double-kill market for both long and short positions will occur, perhaps in the near future.
I have always believed that there will be a downward "squat" before a big rise. The fact that there is none at the moment only proves that it is not a real "bull market".
Whether BlackRock’s BTC spot ETF application will be approved is a matter for the end of this year or next year. Currently, the only positive news that directly affects cryptocurrencies is the EDX Markets exchange established by the “new force” among the Old Money on Wall Street.
However, from the perspective of EDX Markets’ operations, its various operating modes are all “catering” to regulation, which is not what the outside world expected. Therefore, I personally think that the only “good news” at present is not enough to support the long-term upward momentum.
Later, around the end of the year? Or in 2024, there may be more positive news. Many well-known companies are interested in the restart of FTX 2.0, which will be a big positive. The well-known companies on the list include Nasdaq, Ripple Labs, Galaxy Digital, BlackRock, Tribe Capital, Robinhood, NYDIG and OKCoin.
In general, I personally suggest not to chase high prices, there will be opportunities to get on board. After the callback, appropriately add some tokens suitable for long-term holding, such as ETH and BTC. I hope everyone stays away from leveraged contracts!!!