If you think the bearishness is only in crypto, have a look at traditional markets.
There’s nothing as volatile, but equity indexes are all broadly lower. Investors are looking at jobs data (jobs added, unemployment claims, etc.) and not seeing the pick-up they hoped for. With the covid delta variant being a real thing, markets will probably remain cautious in the next few sessions.
The crypto space, amid pretty massive liquidations, was really impacted by derivatives traders taking leveraged positions. Markets are almost at a stand-still.
I’ve heard more about the presumably unexciting El Salvador BTC implementation, but I can’t believe smart money expected a big ‘bang’ on the first day or even in the first weeks or months.
Right now, BTC is at $46,200. But very interestingly, the BTC dominance is lower, suggesting that traders have taken advantage of the moves to allocate to alts, either with stablecoins or by transitioning some of their BTC.
And indeed, some outperformers have popped up: LUNA is up 10% on the session, KSM and MATIC both gained a healthy 4.5%. Then we see coins like XTZ, GRT, ETH, and DOT not rising much but are in the green and doing better than King Coin.
Away from price action, I see two news articles that I find incredibly bullish. Panama and Ukraine are both looking at passing bills to regulate cryptocurrencies. Note that this isn’t the legalization of the tender but just a regulatory framework for the use, transaction, etc., of cryptocurrencies, giving some much-needed clarity and helping actors in that jurisdiction to operate credibly.
A second and last thing I want to touch upon is a chart by CryptoQuant showing the exchange supply of BTC. One might think that a lot of panic or large transfers into exchanges triggered the sell-off but looking at the metric, it keeps on going down, highlighting the move was really derivatives driven and that the fundamentals that took us higher recently haven’t changed.
It looks like crypto isn’t correlated to traditional markets, at least not during this past session.
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