Here’s What’s Behind the Crypto Market Downturn in 2022, According to MicroStrategy CEO Michael Saylor
Bitcoin (BTC) bull and MicroStrategy CEO Michael Saylor is analyzing the factors that he believes are driving the crypto market downturn at the start of a new year.
In a new Bloomberg interview, Saylor unveils two factors that he says are contributing to the volatility experienced by the crypto markets so far this year.
“I think that there’s a lot of dynamics here. If you look at the entire crypto ecosystem, you have a set of regulatory uncertainty, especially regulatory uncertainty around stablecoins and crypto tokens and whether or not they’re securities. And that creates a little bit of anxiety.
You have a lot of leverage offshore. You have a lot of crypto exchanges that can trade with up to 20x leverage. And those crypto exchanges have many, many tokens that are cross-collateralized. Between them and the decentralized finance [DeFi] exchanges, you can get much higher than 20x leverage. So that’s the second source of volatility.”
According to Saylor, Bitcoin is currently offering a “great entry point” for institutions especially as legendary investors such as Bill Miller allocate a huge portion of his portfolio to the flagship cryptocurrency.
“I feel like it’s consolidating at this level. This is a great entry point for institutional investors. I talk to high net-worth individuals, family offices, public company executives, private company owners and they watched Bitcoin run up in 2021. And there are a lot of people that would be afraid to own it if it was going up 400% a year.
But if they’re staring at it and it’s 40% off the all-time high and it’s consolidating. And they see that it’s being embraced by people like Bill Miller, by very well-respected investors. It’s being embraced by the regulators, it’s being embraced by senators and congressmen and public investors and public companies. They are looking at this as like a good entry point.”
Bitcoin is trading at $36,459 at time of writing, down by over 24% from the 2022 high of $47,979.
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