In the crypto market, debates have been going on for a while whether Bitcoin and altcoins have reached the bottom. According to short selling data for June, traders believe the crypto market has bottomed out. Monthly shorts in stocks and cryptocurrencies in the US fell to $20 billion in July. By the way, we should remind you that in the previous month there was 60 billion dollars.
Bitcoin and altcoin capitulation over?
As you follow on Kriptokoin.com, the crypto market has lost about two-thirds of its value this year. This, in turn, causes investors to be wary of further volatility. According to a Forbes report, it’s possible that sales fatigue or crypto crashes may entice shortsellers to wait for a rebound and lower their positions.
In a recent interview with Reuters, FTX CEO Sam Bankman-Fried says he believes the worst of the crypto liquidity crisis is over. SBF points to the stability of prices. He also considers that most of the crisis is now over. CryptoGodJohn, a major crypto tarder and influencer, also highlights SBF’s local bottom signal followed by rising price action.
JP Morgan analysts emphasize that the ongoing crypto crisis will end soon and a recovery can be expected. Analysts point to the financial assistance that troubled firms receive from large companies like FTX. Therefore, he notes, the debt reduction affecting firms such as Three Arrow Capital (3AC) will soon come to an end.
On the other hand, Bloomberg’s Senior Commodity Strategist Mike McGlone says the crypto bottom may already be inside. Bloomberg notes that the Galaxy Crypto Index is approaching a similar drop to its 2018 low. Also, the strategist states that the risk-reward indicator leans towards sensitive investors.
At the same time, the upward price action of cryptocurrencies also reflects changing sentiments. The leading crypto Bitcoin has gained over 13% in the last 7 days at press time. Leading altcoin Ethereum, on the other hand, increased by 15.18% in the same period. Popular meme coin Shiba Inu (SHIB), on the other hand, rose 15.75% on a weekly basis. Also, Solana (SOL) and Avalanche (AVAX) moved up 16% and 23% respectively.
Cryptocurrency shorts earned billions of dollars
According to a report by institutional investors, crypto short sellers of crypto exchange Block made over $1 billion in profits, with a 34% gain. Similarly, Coinbase Global earned 47% worth of $847 million to short sellers.
Tether CTO Paolo Ardoino noted that the reports revealed a massive spike in Tether (USDT) short selling. Also, Ardoino claimed that hedge funds destabilized USDT because of this situation.
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