Pantera Capital: More Crypto Market Turbulence in the Next Months

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Although the crypto market has rallied well over the past week and reaffirmed on Monday, crypto firm Pantera Capital believes that there is still a lot of turbulence in the coming months.

Pantera Capital, in their long note to investors recently, said investors should face more crashes in the crypto market in the coming months, due to the excessive level of leverage in the system.

The reason, according to Pantera, was driven by the impact of the collapse of Terra LUNA, the bankruptcy of Celsius and Three Arrows Capital, due to not being able to repay loan funds because they failed to anticipate the decline in the value of the crypto market. They even projected that other companies would suffer the same fate, forcing the next massive sales action.

Therefore, Pantera advises investors in this bearish period to focus more on Bitcoin and less on altcoins. It should be noted, historically during down cycles, Bitcoin has usually outperformed other cryptocurrencies.

“When crypto markets depreciate, Bitcoin typically outperforms other smaller cryptocurrencies. It happened again in this cycle,” the company wrote.

This has been reflected in the decline in June, as investors adjusted their portfolios to make them more weighty against Bitcoin. In addition, Pantera said when there are clear signs that the market has formed a base, it will consider reallocating some capital to other, more risky cryptocurrencies.

It should be noted that there is still a lot of uncertainty in the crypto market due to the recent internal structural collapse and overarching macroeconomic concerns. As a result, the market has been moving in a very tight range in recent weeks.

Analysts remain divided on when the market will bottom out and eventually reverse course. However, some experts agree that the $20,000 price point should provide significant support for Bitcoin, but a break below could push it up to $12,000.

The results of the Finder.com expert panel survey said a decline to the range of US $ 13,600 is still possible, the impact of the next strengthening of the dollar, because the Fed will continue to raise its benchmark interest rate to fight inflation.

It should be noted that at the time of writing, Bitcoin price had broken through US$22,700 on a number of major crypto exchanges, as the US dollar was weakening after the dollar index (DXY) touched 109.