ChainCatcher news, 10x Research said in its latest report that many people attributed the Bitcoin sell-off to the unwinding of yen carry trades, but the reality is much more complicated. Bitcoin has been vulnerable since mid-March, and although the Nasdaq index has risen 15% and the yen has depreciated 10% during this period, Bitcoin has remained in a range. Carry trades rely on continued high interest rates in the United States, which are unlikely to continue. The rules of the game have changed.
Over the past 24 hours, crypto market volume reached $244 billion, the highest level since March 6. Bitcoin experienced a large amount of intraday liquidations on the day after reaching a new all-time high. While we were very bullish in February and early March, we took a cautious stance after the sharp drop because our backtesting showed that the future market was unpredictable. In hindsight, this was the right decision.
Financial markets are like jigsaw puzzles that need to be periodically reassembled as new drivers of asset prices emerge. This is one of those times. Unlike the sharp declines in April and June, which were mitigated by increased leverage, there may not be such a reversal this time.
