Bitcoin's Potential Crash Could Be More Severe Than Market Participants Realize, Mechanism Capital Co-Founder Says

According to BlockBeats, Andrew Kang, co-founder and partner at crypto venture capital firm Mechanism Capital, has expressed concerns about the potential severity of the Bitcoin slowdown. He shared his views on social media on July 4, stating that most market participants may not be aware of the severity of a possible decline in Bitcoin's volatility range over the next four months.

Kang drew parallels to a similar situation in May 2021, when Bitcoin and altcoins also experienced a parabolic rise. He noted that cryptocurrency leverage of over $50 billion is also near all-time highs, excluding the Chicago Mercantile Exchange (CME). However, in this case, the time range is longer (18 weeks vs. 13 weeks) and an extreme decline has not yet occurred, as was experienced several times during the 2020 to 2021 bull market.

Kang's initial estimate of a $50,000 bottom may have been too conservative. He suggested that we could see a more extreme pullback to the $40,000 range. Such a pullback could cause significant damage to the market and may require several months of swing/downtrend (recovery period) before a possible reversal of the uptrend can occur.#Bitcoin $BTC