Michael Bucella, a general partner at cryptocurrency investment firm BlockTower Capital, has revealed he believes bitcoin is still in a “long term bull trend” after analyzing the cryptocurrency’s price action through a logarithmic chart and suggesting BTC’«s rise last year wasn’t sustainable.

Speaking to CNBC, Bucella noted that most high-growth investments saw their growth accelerate over the last few months before enduring a “blowout” that trailed off into the cryptocurrency space, leading to steep discounts on certain investment products like Grayscale’s Bitcoin Trust.

To the analyst “broad risk assets are digesting higher [interest] rates and tighter financial conditions,” as investors drop riskier assets in a bid to move into safe-havens. Bucella added that as equities markets plunged and leveraged investors started seeing margin call notifications, they drew liquidity off of the cryptocurrency space in a bid to prevent liquidation.

Bucella added that BlockTower capital tracks a number of metrics in the market and has seen “a degradation of the market structure in crypto” over the last few months,” although he considers this is a “great opportunity for people to enter the market.”

To enter the market, he implied investors should be dollar-cost averaging in a bid to divide up the total amount to be invested in periodic purchases in a bid to reduce the impact of volatility, which is high in the cryptocurrency market. He added:

  • Bitcoin is still firmly in growth mode, and if you look at a logarithmic chart, it’s still a long term bull trend. It’s still a young asset class, this is not all too surprising volatility, and Bitcoin and Ether were structurally low and declining over the last year.

As CryptoGlobe reported Ari Paul, CIO and managing partner at BlockTower Capital, has revealed he believes bitcoin’s bull run will see the cryptocurrency trade at $400,000 by next year.

Notably, in 2017 BlockTower Capital made a $1 million bet that the price of the flagship cryptocurrency would trade at $50,000 in 2018. While the firm’s bet flopped, BTC did trade at $50,000 years later, in 2021when it reached a new all-time high near $64,000.

DISCLAIMER
The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.

IMAGE CREDIT
Featured image via Pexels