Bitcoin

How Crypto Founders Are Preparing for the Next Bear Market – DL News

Published

11 months ago

3 June, 2024

SatoshiTimes Staff

How Crypto Founders Are Preparing for the Next Bear Market – DL News

Crypto founders expect another downturn within 18 months.
Elliot Chun, partner at Architect Partners, describes his thinking.
Some areas of concern include the enthusiasm surrounding fluid resumption protocols.

Crypto founders are already preparing for the next crisis.

This is according to Elliot Chun, partner at Architect Partners, a firm that advises crypto companies on mergers, acquisitions and financing strategies.

“They all come to me saying, ‘I’m preparing for the next drop in 18 months and I want to capitalize on the current change,’” Chun said.

“I’ve never had so many founders and executive teams say we need to make something happen within 18 to 24 months.”

The fear is justified. The brutal crypto crisis of 2022 caught many companies off guard.

Crypto companies like Bitcoin mining company Core Scientific and exchange Voyager have had to declare bankruptcy, not to mention spectacular fraud-driven blowups like FTX.

Still, savvy startups can turn the current bull run to their advantage by taking advantage of Wall Street’s interest in crypto as well as venture capitalists’ renewed interest in the sector.

Be ready

Chun said crypto companies are preparing differently depending on their profiles.

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“Most of the time, they look for a strategic partner – a company in the traditional financial sector that has a similar vision,” Chun said. “They could be there as business partners or eventually acquire the crypto company outright.”

Naturally, companies that raised significant capital in 2020 or 2021 don’t think the same way as those that didn’t – like recent startups.

The former often seek to generate enough revenue so that private capital can buy them. One way to do this is to establish a global presence, as the industry is still largely fragmented on a regional basis.

Elliot Chun (Darren Joseph/Darren Joseph)

Companies can also choose to expand their suites of products and services.

“Institutional clients don’t want to work with five different groups to custody, tokenization, increasing funding – they need comprehensive, comprehensive services,” Chun said. “There aren’t many who can do all that.”

Recent startups, Chun said, have one or two great products and are run by people who believe in the industry’s long-term potential — but being a founder is hard work, so they’re open to being acquired.

Learning from 2021

Enter Wall Street’s entry into space through Bitcoin spot exchange-traded fundsand increased adoption, the prospects for well-run crypto companies have never looked better, Chun said.

It’s a different feeling from the excesses of 2020 and 2021, when VCs’ fear of missing out “led to unrealistic valuations, which in turn led to poor operating discipline,” Chun said.

Companies acted as if the abundance of capital would last forever.

“People were spending money on ridiculous things — like $150,000 on a party at a conference, for a pre-revenue company,” Chun said.

But companies that survived the crisis had “much greater” operational discipline, Chun said.

Some are even generating revenue.

Reestablishment of liquid

Even though this bull market is healthier than the last, concerns still remain.

Chun cited the hype surrounding EigenLayer and others reestablishment protocols – which allow investors to secure the Ethereum blockchain and other protocols, such as oracles and bridges, with the same stack of Ether.

“The concept of liquid restoration it’s essentially internal crypto-native recipes being layered on top of others, to the point where no one understands how to untangle these things,” Chun said. “This is dangerous.”

Coinbase researchers expressed similar concerns in a April report.

Eigenlayer did not immediately respond to a request for comment.

These projects are receiving a lot of capital from VCs because they generate quick and surprising returns, Chun said.

Investors who allocate capital to projects will tend to jump ship immediately after the token allocation is unlocked, Chun said – similar to venture funds selling their shares immediately after a company goes public.

While companies take three to seven years to go public, crypto projects can launch their coins live within months.

“VCs can go back to their liquidity providers and say we got 80% returns in a year – and they look like geniuses,” Chun said.

Memecoins

Private investment is also warping markets on a larger scale, Chun said.

Original crypto investors could leverage their knowledge of the technology to their advantage in the past, but that has changed.

Everyone has access to the same information and can execute that information at the same speed.

So how do professional investors gain the upper hand?

“Their advantage is just getting early access to projects,” Chun said. “Whether it’s seed rounds or equity rounds, with token distributions that normal people don’t have access to.”

This could explain why retail traders resort to memecoins that doesn’t have billion in tokens ready to be unlocked, leveling the playing field.

“Retailers actually have the ability to prove once again that they can get more returns from something that doesn’t have a venture fund – or a founder,” Chun said. “I can’t blame them for trying.”

Still, Chun said memecoins that don’t seek to advance the space will ultimately be their undoing.

“The market will dry up.”

Tom Carreras is markets correspondent for DL News. Have a tip about VCs and crypto? Get in touch at tcarreras@dlnews.com

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Bitcoin

What to watch for in the markets

Published

9 months ago

21 July, 2024

SatoshiTimes Staff

Photo: Andrew Harnik (Getty Images)

After witnessing one of the largest global IT outages on record, affecting the travel, finance and healthcare sectors worldwideThis week is set to see more political drama, events, and earnings reports from tech giants.

Donald Trump’s ‘Lovefest’ Sets Jamie Dimon Up for Consideration for Treasury Secretary Job

Let’s take a look at what awaits us:

Major companies will release their earnings reports

Major tech companies and others will release their earnings reports this week, paving the way for what the second half of 2024 will look like.

Monday

Verizon will report earnings before the start of operations.

Tuesday

Coca-Cola, Comcast and UPS are all set to report earnings before the market opens.
Tesla will report earnings in the morning, while General Motors will report earnings in the evening.
Alphabet and Visa will report results after the market closes.

Wednesday

AT&T will release its report before the market opens.
Ford and Chipotle will report earnings after the market closes.

Thursday

Earnings reports from AstraZeneca, American Airlines and Southwest Airlines will be released before the market opens.

Trump to speak at Bitcoin conference

Presumptive Republican presidential nominee Donald Trump will speak at the next Bitcoin Conference in Nashville, Tennesseewhich is scheduled for July 25-27. While this is the first time a presidential candidate will attend the conference, it has sparked a debate over whether the crypto-friendly Trump will receive support from the crypto community in the upcoming election.

In addition to Trump, independent presidential candidate Robert F. Kennedy Jr. will also discuss crypto during the conference. Crypto advocates such as ARK Investment’s Cathie Wood, MicroStrategy’s Michael Saylor, and whistleblower Edward Snowden are among some prominent names who will be participating in the conference.

Ether ETFs are on the way

New Ether Spot ETFs are set to begin trading on Tuesday, July 23. Much like the spot Bitcoin ETFs, these ETFs will allow investors to buy the second most popular cryptocurrency like stocks. BlackRock, Ark Invest/21Shares, VanEck, Grayscale, Fidelity, Bitwise, Franklin Templeton, and Invesco/Galaxy Digital are all set to offer Ether ETFs. Crypto asset manager Bitwise predict that trading in the Ether ETF will drive the price of Ether higher, potentially surpassing $5,000.

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Bitcoin

Cryptocurrency’s Biggest Winners and Losers in a Second Trump Presidency

Published

9 months ago

21 July, 2024

SatoshiTimes Staff

Cryptocurrency’s Biggest Winners and Losers in a Second Trump Presidency

Bitcoin miners and cryptocurrency companies that have been blocked from going public in the U.S. could ultimately be the biggest winners in the digital asset world under a second Donald Trump presidency. Foreign companies at risk of losing market share could end up being the biggest losers.

That’s the view that’s taking hold among market participants and observers in the wake of the former president’s growing embrace of cryptocurrency as his chances of election grow. survey released Thursday by CBS News showed Trump with the majority — 52 percent — of likely voters in his likely November rematch with President Joe Biden.

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Bitcoin

Bitcoin, Ethereum, Solana and Cryptocurrency Markets Look Ready to ‘Send’ as Stars Align, According to Investor Chris Burniske

Published

9 months ago

21 July, 2024

SatoshiTimes Staff

Bitcoin, Ethereum, Solana and Cryptocurrency Markets Look Ready to ‘Send’ as Stars Align, According to Investor Chris Burniske

Cryptocurrency investor Chris Burniske says Bitcoin (BTC), Ethereum (ETH), Solana (SUN) and the cryptocurrency market in general seem poised for a run.

Former Head of Cryptocurrency at ARK Invest account his 292,200 followers on social media platform X that several catalysts are aligning, suggesting that digital asset markets are on the verge of a bull run.

According to Burniske, a partner at venture capital firm Placeholder, the highly anticipated launch of Ethereum-based exchange-traded funds (ETFs), Republican presidential candidate Donald Trump speaking at an upcoming Bitcoin event, and the current state of the BTC, ETH, and SOL charts all suggest significant optimism for the cryptocurrency markets.

“With ETH ETFs set to go live, Trump speaking at The Bitcoin Conference, and BTC, ETH, and SOL charts looking [they do] (while stocks are weak), it’s hard to imagine a world where we don’t ship next week.”

Reuters recently reported that preliminary approval for ETH ETFs has been granted as the Bitcoin Conference is scheduled to take place from July 25-27.

BTC, ETH, and SOL are trading at $67,333, $3,528, and $174 at the time of writing, respectively.

The venture capitalist too provides an update on his prediction that the total crypto market cap will eventually hit $10 trillion. According to his chart, the path to $10 trillion is currently “23%” complete, as it sits around $2.2 trillion.

Source: Chris BurniskeX

Earlier this month, Burniske he said in an interview with Real Vision CEO Raoul Paul that he has his eye on the Move ecosystem, which was originally built by social media giant Meta and then used to develop layer 1 blockchains Sui (IUE) and Apts (APT).

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Bitcoin

Here’s the next target for BTC before bulls can hold out for $70K

Published

9 months ago

21 July, 2024

SatoshiTimes Staff

Here’s the next target for BTC before bulls can hold out for $70K

Bitcoin’s recovery is going well, and the market is seemingly poised to create a new all-time high in the near term.

Technical analysis

Per NegotiationRage

The daily chart

As the daily chart shows, the price of Bitcoin has been rising since it broke above the 200-day moving average.

The market has also reclaimed the $60K and $65K levels and is moving towards the $68K resistance zone, which could be the last hurdle before creating a new all-time high. With the RSI also indicating that the price has clear bullish momentum, it could be just a matter of time.

Source: TradingView

The 4-hour chart

Looking at the 4-hour chart, it is evident that the price has been rising rapidly since breaking the downtrend line to the upside. The market also broke the $65K resistance level with momentum, turning it into a support.

While almost everything points to a new record high in the coming weeks, there is one worrying sign. The RSI is showing a clear bearish divergence between recent price highs, which could indicate a correction or even a reversal in the near term.

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