The market is in turmoil, will it continue to decline in the future?

Author: 1912212.eth, Foresight News

Not long ago, a remark from legendary trader GCR left a deep impression. In June, while responding to comments on market conditions, he said the current market feels more like the late summer after the DeFi wave of 2020, or equivalent to the summer of 2021, and we are still in a bull market.

This response filled many market players with anticipation for the upcoming July. Just as everyone was eager to bid farewell to May and June, thinking July would bring a "turnaround," the market played a huge joke on investors. First, the German government sold nearly 10,000 bitcoins, with another 40,000 still for sale. Then, there was a massive compensation of 142,000 bitcoins from Mentougou. After testing small transfers yesterday, nearly 50,000 bitcoins were transferred today to a new wallet address and a suspected exchange address.

Under the continuous negative news stimulation, BTC fell below $60,000 and continued to decline sharply. After dropping below $57,000 yesterday, it briefly fell below $54,000 today, reaching a low of $53,485. Ethereum also fell below $3,000, dipping to a low of $2,810, while other altcoins generally saw declines of over 10%, with some even exceeding 20%.

The panic sentiment in the crypto market even reached a new low since September 12, 2023. Where will the market head in the future?

dForce Founder Mindao: There may not be an altcoin bull market

dForce founder Mindao tweeted that we are in a very different market cycle, where a significant amount of liquidity is flowing into stablecoins rather than BTC and ETH. This does not mean that the major coins in the market won't rise, but that kind of certainty and good times may be hard to come by. We may also not see an altcoin season.

Additionally, the distribution of fiat compensation from Mentougou has begun, which may help alleviate market panic.

Blockstream CEO: Historically, there have been 6 instances of 30% declines in bull markets; buy on dips

Blockstream CEO Adam Back stated that there have been six instances of 30% declines in historical bull markets, and the current decline is about 26%. The recent drop is not significant, and he advises investors not to panic and to buy on dips.

OX.FUN Founder Zhu Su: Bought back ETH at $2,900

OX.FUN founder Zhu Su tweeted today that he previously sold Ethereum around $3,300 and bought back ETH at $2,900. A few hours later, he tweeted again, stating that you won't see this drop on the charts fifty years from now.

Santiment: Historic panic sentiment on social media; an opportunity for the bold

Crypto analytics firm Santiment reported that as the market continues to decline, historic panic sentiment has emerged on social media. It is rare for mentions of "sell" to outnumber mentions of "buy" within an hour. However, in the past 24 hours, this has been observed, including the largest ratio of negative to positive comments since 2024. For bold traders, this presents an opportunity, as some may wish to become true contrarian investors by buying when the crowd is angry and frustrated.

WOO X COO Willy Chuang: Long-term, negative impacts will gradually dissipate

WOO X COO Willy Chuang stated that the transfer of 47,228 BTC from Mt. Gox marks the beginning of its repayment process. The potential for large-scale sell-offs has triggered some market panic, exacerbated by various factors including the German BTC sale, Federal Reserve issues, and uncertainty surrounding the U.S. elections.

Despite the concerns, as the market gradually absorbs the selling pressure, the long-term impact may not be as severe. According to Mt. Gox's 2023 data report, the actual amount sold is far less than the total, as many creditors have sold their claims to funds due to the lengthy compensation period. Therefore, these claims are mainly held by institutional entities, with only 226 creditors holding over 50% of Mt. Gox's claims. Panic is expected in the short term, but in the long run, these negative factors may gradually dissipate.

Placeholder Partner Chris Burniske: Without significant downside risk, you can't achieve crazy returns

Placeholder partner Chris Burniske tweeted that after SOL rose about 10 times in 2020, it fell 80% later that year. The following year, in 2021, it increased over 100 times again. Then, it dropped 97% to around $8 in 2022, before rising about 20 times again. ETH and BTC also exhibited similar volatility in their early days.

For those who complain, without significant downside risk, you can't achieve huge crazy returns.

If you have become accustomed to being scared by the market, you will gradually become numb to such declines and choose to ignore them. No matter what happens here, what I see is opportunity.