Mountains and Valleys

Just when things started to look a bit better again, the unimaginable happened: FTX, the US based crypto exchange founded by Sam Bankman-Fried experienced a bank run and it quickly became apparent that FTX did not have the necessary funds available to satisfy their client's withdrawal requests.

It's currently hard to come up with an interpretation of the situation that doesn't involve malicious intent on the side of FTX and Sam Bankman-Fried's other big entity, Alameda. This situation has surprised even the most hard-boiled crypto enthusiasts and made many question their involvement in the space.

Seen from another perspective, it was again a highly centralized and known to be extremely predatory organization that blew up, not any of the technologies or protocols that we are actually here for. Let's hope that with time the original ideas of crypto prevail, the few remaining good actors in the space keep their faith and help rebuild what's been destroyed by the greed of others.

The crypto market remains in what looks like a bottoming phase. A lot of experienced crypto traders are confused by the fact that Ethereum rests around 60% above its June 2022 low, while Bitcoin, usually the leader of the market, briefly touched new lows yesterday.

This deviation quite likely has fundamental reasons in the upcoming switch of Ethereum from Proof of Work to Proof of Stake. "The Merge" will greatly reduce Ethereum inflation and thus is likely to act as a bullish catalyst on a longer time frame.

Will the market touch the lows again or even suffer another 50% breakdown like it did in previous bottoming phases? Nobody knows, but if history rhymes, it's quite plausible that the few remaining months between now and the end of the year will mark the bottom, and that a very slow recovery awaits us in 2023.

We are playing the long game, hodl, and look forward to the crypto crazyness that will certainly go down during The Merge. 🐼

Crypto experienced an impressive series of disasters in the past few months: the Luna collapse, followed by the insolvency of 3 Arrows Capital, Celsius and several others.

Amidst the fallout of these events, the market put in a temporary bottom in June and has since recovered quite a bit.

Bearish sentiment however remains dominant and we maintain our conservative structure. All in all, there's currently not much more to do than observe the situation.

We believe that price wise, the majors are closer to a bottom than to the last top, but time wise, the market could still take a while to digest the massive uncertainties that sprung from the above events and the precarious global macro situation.

Some signs of a relief bounce.

Deploying our last fiat, staying mostly in $ETH and $BTC with a small punt in $FXS , it dipped a lot because of $LUNA panic irrational contagion.

Dire straits. We are selling a bit more USD, keeping a conservative structure.

A brutal and likely historical day in crypto, with the UST algorithmic stablecoin on the verge of collapse. We put 1/4 of our USD back into the market, as this is definitely a "blood in the streets" moment.

Hmm, either this is the end of the crypto world as we know it, or the beginning of something new, or just a fluke. Nobody really knows, so we are rebalancing. Keeping the defensive structure. 

Reducing risk here while we observe whether this recent recovery was just a dead cat bounce. The overall market sentiment remains bearish and we could be in for more pain.

Quick rebalance to take wonderful gains on FXS and Near.

In the past weeks, crypto managed to maintain a local uptrend in spite of dire macro conditions. With individual alts flaring up occasionally, it's mostly Bitcoin and Ethereum leading the recovery. Too early to celebrate (and not really a time for celebrations in any case), we maintain the current portfolio and do a regular rebalance.