In this blog post, I want to share with you some of my thoughts and assessments on the current developments in the cryptocurrency market. Among other things, we will talk about whether I still see a new all-time high in 2023 and whether I prefer Bitcoin or Ethereum.
Bitcoin: The Strongest Brand with Risks
Bitcoin as Inflation Protection?
Bitcoin has established itself as a strong brand, but there are some concerns. A friend of mine got me thinking about whether Bitcoin is really an inflation hedge as it is often claimed to be. He also talked about the 4-year cycle theory. If we don’t see a halving cycle, that could mean that many of the theories that have been pushed on Bitcoin haven’t really come to pass.
Bitcoin ETF and Concentration Risk
The Bitcoin Sport ETF could be a strong fire upgrade for Bitcoin, but there are risks as well. Michael Saylor wants to invest another $750 million in Bitcoin, which is positive for the price, but that could undermine the actual value of Bitcoin. Why? Concentration risk. He will have to sell his Bitcoins at some point, and that could affect the price.
Ethereum: The Chance for the Top Spot?
Ethereum’s Deflationary Benefit
Ethereum has enormous potential and could even overtake Bitcoin as the top spot in the next 12 months. It’s the only chain I know of that yields a nice return and is completely deflationary. That makes it a huge opportunity for me.
Ethereum Futures ETF
A potential Ethereum Futures ETF could have similar effects to the Bitcoin Futures ETF. It could lead to a new all-time high but also carry risks. So why not bet on both horses? Both Bitcoin and Ethereum.
Stable Coins and Regulation
Stable Coins are not seen as money, and that allows exchanges and users to deal with them. But how long will that last? Regulation could change, and that could affect the business model of companies like Tether.
Conclusion
We are currently experiencing a bottoming in the crypto market. There is little selling interest, and I see potential for growth as long as no major players suddenly have to sell. I am generally bullish and believe that it is a good time to invest in crypto via Dollar-Cost-Averaging. Did you know we know have a nice DCA feature on Bake? Buy crypto per credit card without any fees and even up to 11% on top.
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Julian
CEO Cake Group & Bake
