10x Research Says Crypto Rally Lacks Sustainable Catalysts, Identifies ETH as Weak Point

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As a seasoned crypto investor with several years of experience under my belt, I’ve seen this movie before. The recent Ethereum ETF launch hype reminded me of past events like Bitcoin futures and various other crypto listings, which all followed a similar pattern: an initial surge in excitement, followed by a sharp correction. And as 10x Research rightly pointed out, the Ethereum ETF launch coincided with the distribution of Bitcoin from Mt. Gox, adding to the selling pressure.

The excitement surrounding the Ethereum (ETH) ETF launch has fueled a recent cryptocurrency market rally. However, based on 10x Research’s analysis through several tweets, this surge may be starting to lose momentum and follow the typical trend of “selling the news” – a pattern observed in past crypto market cycles.

Market Patterns and ETH Weakness

As a seasoned crypto investor, I’ve observed that historical patterns often repeat themselves in the cryptocurrency market. For instance, the frenzy surrounding Ethereum’s upcoming ETF launch mirrors past events such as the Bitcoin futures launch in late 2017 and Coinbase listing in April 2021. Each of these milestones initially generated massive excitement, but were subsequently followed by considerable market corrections. Given this trend, I believe Ethereum could be a potential candidate for a significant correction post-ETF launch.

“According to 10x Research, the excitement surrounding the Ethereum ETF launch has come to an end. Previously surging crypto markets have transitioned into sell-off territory post-launch.”

10x Research noted that the Ethereum ETF debut overlapped with Bitcoin’s distribution from Mt. Gox, which could have intensified selling activity. Furthermore, a disappointing beginning to the US tech earnings reports, featuring notable corporations like Alphabet and Tesla experiencing significant sell-offs, has contributed to the market’s pessimistic mood.

Stagnant Fundamentals

Expert: 10x Research highlighted Ethereum as a potential vulnerability in the cryptocurrency sector. They pointed out that its essential metrics, such as user expansion and earnings, have either plateaued or deteriorated. Before the ETF debut, they conveyed a pessimistic stance on Ethereum, deeming it overvalued and anticipating a profitable short position. Since then, Ethereum has already experienced a 6% decrease in value.

“10x Research posits that cryptocurrencies may require additional support for further growth. Among them, Ethereum could present a challenge due to lackluster fundamentals such as user growth and revenue generation.”

As a researcher studying the crypto market, I’ve come across 10x Research’s findings which cast doubt on the longevity of the current rally, particularly for Ethereum. While some investors remain hopeful, the challenges identified by my research indicate that this uptrend might not have the necessary strength to endure in the long run.

Current State of the Market

The wider cryptocurrency sector is experiencing turbulence, causing a 2.3% decrease in Bitcoin’s value within the last day, now sitting at $64,320. This slip comes after a brief upward trend over the weekend, pushing Bitcoin above $68,000 momentarily. Although the market is showing signs of decline, certain indicators suggest optimism. Technical analysis from TradingView reveals a “buy” signal for Bitcoin, and moving averages also indicate a similar call. However, oscillators show no clear direction yet.

Ethereum, like other cryptocurrencies, experienced notable drops in value. The newly introduced US Ethereum spot ETFs demonstrated varying outcomes. Meanwhile, Grayscale’s Ethereum Trust ETF (ETHE) witnessed substantial withdrawals totaling $810 million. Previously, the SEC’s approval of ETH ETFs had resulted in an increase in Ethereum futures open interest and prices. However, it seems that the traditional pattern of price corrections following the launch of these funds is repeating itself.

If we don’t have sufficient eco-friendly catalysts, it’s possible that more adjustments will be required in the future as long as no significant advancements occur.

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2024-07-25 11:51