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In a recent video, analyst Michaël van de Poppe delves into the ongoing crypto crash and why his altcoin strategy failed. All this and much more! Read on.
Understanding the Current Crypto Crash
Van de Poppe begins by noting the significant downturn in the crypto market, with altcoins like Arbitrum and Optimism hitting unprecedented lows and Bitcoin dropping to around $54,000, not seen since October last year. Despite falling macroeconomic factors like a weakening US dollar and dropping government bond yields, Bitcoin and altcoins are still struggling.
He attributes this downturn to Germany’s Bitcoin sales, which reduced their holdings from $3.2 billion to $2.3 billion, and the Mt. Gox repayment of 30-40% of their Bitcoin, which started on July 5th after a decade of insolvency, causing market anxiety.
Van de Poppe’s Altcoin Strategy
In the challenging times, Van de Poppe’s game plan for the coming months involves sticking to his altcoin strategy despite the current market downturn. He plans to continue holding altcoins to accumulate more Bitcoin, focusing on their Bitcoin valuations rather than USD values.
He believes the market is in a capitulation phase, similar to past downturns, and expects a recovery driven by events like the Ethereum ETF. He advises watching Bitcoin dominance and sees the current period as a buying opportunity. Despite recent corrections, the analyst believes downturns often signal prime entry points for altcoin investment.
His Top Altcoin Picks!
Arbitrum (ARB)
Arbitrum is a layer-2 scaling solution for Ethereum, designed to improve the speed and reduce the cost of transactions on the network. Van de Poppe notes that Arbitrum is hitting cycle lows amid the broader market downturn.
Optimism (OP)
Like Arbitrum, Optimism is another layer-2 scaling solution for Ethereum. It aims to enhance Ethereum’s throughput and efficiency. Van de Poppe includes Optimism as an example of altcoins reaching unprecedented low prices during the crash.
Ethereum (ETH)
The second-largest cryptocurrency by market capitalization, Ethereum is a significant part of his portfolio. Despite a severe drop in USD valuation, he points out that its value in Bitcoin terms (BTC pair) is relatively stable, reflecting a slight gain.
Chainlink (LINK)
Chainlink is a decentralized oracle network that provides reliable, tamper-proof data for smart contracts on any blockchain. Van de Poppe discusses Chainlink being at its cycle low again, with a 15% drop against Bitcoin in his holdings.
Wormhole (WORM)
Wormhole is a cross-chain communication protocol that allows different blockchains to interact. It’s one of the newer coins in Van de Poppe’s portfolio. He mentions that this coin is down 50% from his purchase price, indicating its high volatility but also potential for high returns.
Overall, he says, this is the best time to invest because historical trends indicate that altcoins do best in Q3- and Q4.