Digital asset investment firm DeFiance Capital‘s founder and CEO, Arthur Cheong, shared a commentary on the latest decline in the cryptocurrency market. In a post on social media platform X, he noted that the current cryptocurrency downturn resembles the dramatic crash of March 2020, driven by weaknesses in traditional finance (TradFi), though this one appears to be somewhat less severe in scale.
He further suggested that the cryptocurrency market is likely to experience a period of low liquidity over the next few weeks. However, this could present some of the best investment opportunities for traders who have cash available. Arthur Cheong anticipates that, subsequently, some major players who missed out on entering the market earlier this year may take advantage of this opportunity to invest.
Eerily similar to March 2020 great crash of crypto driven by macro tradfi weakness albeit slightly smaller in magnitude.
Market will go into low liquidity period over the next few weeks but generally you find the best investment opportunities here if you have cash to buy.
Some…
— Arthur (@Arthur_0x) August 5, 2024
In March 2020, Bitcoin abruptly fell from $8,000 to $3,867. This crash was triggered by multiple factors, including the coronavirus outbreak, which impacted global markets and drove investors toward the safety of cash. Additionally, an uptick in equity markets, which may have been a chart-driven bounce, and the Federal Reserve’s decision to inject $1.4 trillion into the financial system influenced the situation. The dip also occurred during a period of volatile trading on Wall Street.
Justin Sun Purchases 16,236 ETH Amid Market Decline
The recent decline also occurred against a backdrop of multiple strong factors, including macroeconomic updates, asset movements by Jump Crypto, and the increasing likelihood of Kamala Harris winning the upcoming United States election over pro-cryptocurrency candidate Donald Trump.
As of the current writing, Bitcoin is trading at $51,511, reflecting a decline of over 15.39% in the past 24 hours. Meanwhile, the price of ETH is currently $2,256, marking a 22.61% decline over the past day, according to data from CoinMarketCap. This continues the downward trend that began over the weekend.
Notably, some market participants are already taking advantage of the current conditions. Cryptocurrency entrepreneur Justin Sun has reportedly used 37 million USDT to purchase 16,236 ETH. According to on-chain analysts, the address was created today and withdrew 38 million USDT from the HTX cryptocurrency exchange.
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