<\/p>\n
The co-founder and chief investment officer of digital asset investment firm BlockTower Capital says conditions look ripe for crypto to keep trending higher in the medium term.<\/p>\n
Ari Paul says on the media platform X that while he\u2019s not certain about how the macro side will play out in the next three months, he notes that crypto-specific indicators look favorable for the digital asset market.<\/p>\n
The BlockTower Capital executive highlights<\/a> that crypto is currently not flashing signs of elevated hype and speculation, suggesting that the markets are in a position for bullish continuation.<\/p>\n \u201cOn the crypto \u2018idiosyncratic\u2019 side, we see very low leverage levels, neutral sentiment, and healthy market positioning. <\/em><\/p>\n I think the pattern matching of the ETF (exchange-traded fund) approval to previous events like the 2017 futures listing are bad analogies; all of those comparable events occurred far later in the bull cycle in the context of far greater bullish leverage and hype. In my opinion, we\u2019re in a medium time frame bull trend, prices likely higher in six months.\u201d\u00a0<\/em><\/p>\n Looking at the basic economics side of crypto, Paul says<\/a> demand coming from institutional investors and new users is more than enough to gobble up supply entering the markets.<\/p>\n \u201cWe\u2019re currently in a market dynamic of slow institutional adoption and new user onboarding. There are also daily outflows from mining, exchange fees, hacks, etc. <\/em><\/p>\n All of the \u2018overhangs\u2019 that I\u2019m aware of for BTC and ETH are fairly light (like Celsius ETH holdings being liquidated). I think very likely demand keeps overwhelming it with similar dynamics to the past 12 months. Something like Solana is arguably trickier given how much FTX estate has to liquidate.\u201d\u00a0<\/em><\/p>\n According to Paul, crypto is currently following<\/a> a bull market cycle typically witnessed in stocks and bonds as he thinks insiders and institutions are loading up on digital assets before triggering the big surge.<\/p>\n \u201cI\u2019d say: bull cycles follow a common pattern that starts with insider buying then institutional, then retail. I think we\u2019re in early-mid institutional based on fund flows and adoption metrics. The 4th inning of a nine-inning bull cycle. So unless we get a \u2018shock,\u2019 I expect us to move through the next five innings of a bull cycle.\u201d\u00a0<\/em><\/p>\n Paul also says<\/a> that crypto does not necessarily need a new catalyst to keep moving higher, saying that the prevailing uptrend is enough to fuel more rallies.<\/p>\n \u201cFrom a technical analysis perspective, we\u2019re in a medium time frame bull trend, so no catalysts are necessary if I\u2019m right in assessing the current dynamic. <\/em><\/p>\n A little like gravity in Einstein\u2019s formulation \u2013 with no force, the natural path is for objects to follow a curved spacetime. In markets, if you\u2019re in a bull trend or bear trend, then absent catalysts, the best bet is that the trend will continue for at least the next incremental time unit.\u201d\u00a0<\/em><\/p>\n Don’t Miss a Beat \u2013 Subscribe<\/a> to get email alerts delivered directly to your inbox <\/span><\/em>
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