Public Crypto-Faches Public Enterprises are entering a “Player vs Player” stage which will see companies more difficult to compete with investors’ money, and which could increase the prices of the cryptography market, according to Coinbase.
“The days of easy money and guaranteed MNAV bonuses (multiple value of net assets) are over,” Coinbase David Duong and researcher Colin Basco said on Wednesday.
The pair said that the treasures of digital assets (DAT) are in a stage of “player against the player” where “the players strategically positioned will prosper”, adding that they expected that the cryptographic markets “would benefit from the unprecedented capital which flows from these vehicles to over-super yields”.
Analysts have raised fears that the crypto purchasing business market will be supersaturated and that many of them do not survive in the long term. Nydig said on Friday that many cryptographic cash companies had seen their values drop while Bitcoin (BTC) had won.
Cryptographic treasure at the “critical inflection point”
Duong and Basco said the first movers as the main strategy of holding Bitcoin “benefited from substantial premiums”, but “competition, execution risks and regulatory constraints contributed to the compression of the MNAV”.
“The rarity bonus that benefited early adopters has already dissipated,” they said, and now the crypto treasure bills have “reached a critical inflection point”.
At their current player as a player against the player, the success of a cash company “is increasingly depends on the execution, differentiation and timing rather than simply copying the microstrategy game book”, indicates the report.
“September effect” an unreliable indicator
Meanwhile, Coinbase researchers said that “the September effect”, where investors hold Bitcoin because of its fall historically during the month, should not be invoked as a trading indicator.
Bitcoin experienced a drop in September for six consecutive years between 2017 and 2022, giving investors the impression that the month “tends to be a bad time to present risks”.
“However, if you were to exchange this hypothesis, you would have been wrong in 2023 and 2024,” said Duong and Basco.
“The month of the final is not a statistically reliable predictor to know if the monthly logarithmic yields will be positive or negative for the BTC,” they added. “We do not think that monthly seasonality is a particularly useful trading signal for Bitcoin.”
Fed will cut twice, leaving the “room to run” market in the fourth quarter
Duong and Basco said they expect the federal reserve to lower the prices during its meeting on Tuesday and again at its meeting next month, adding that “Crypto Bull Market has room to run” at the start of the fourth quarter.
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They added that Bitcoin could continue to outperform because it “benefits directly from the winds of macro-existing tail”, like the increase in inflation in the United States, which increased by 0.4% in August to 2.9% in the last year, according to an update on Thursday.
The market greatly expects the Fed to lower 25 basic points at the same time next week and in October. The rate reductions were historically a boon for crypto and other risk assets.
“In the direction of the fourth quarter, we maintain a constructive perspective on cryptographic markets, anticipating continuous support for robust liquidity, a favorable macroeconomic environment and encouraging regulatory developments,” said Coinbase researchers.
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