The bear market conditions that have affected cryptocurrency markets over the last couple of months are now largely over, according to a leading cryptocurrency fund manager.
After smashing all-time records in 2017, cryptocurrencies experienced a period of consolidation, with prices falling to their current levels, down 69% since January highs. But now, according to fund manager Timothy Enneking, the tide is about to turn for crypto markets.
Enneking, who heads up Crypto Asset Management, a fund with some $20 million in managed assets, described the bear market conditions as ‘largely over’, suggesting the market had now effectively priced-in all new variables.
Enneking suggested a number of reasons for sell-side pressure on cryptocurrencies over the first part of 2018, including market consolidation, the Mt. Gox liquidation, and crypto startups selling assets to pay staffing costs.
He also suggested that the impact of regulation on the sector, and in particular the activities of the US Securities and Exchange Commission, remained factors in current market prices.
However, Enneking said these factors have now all been priced-in to the markets, and the ground has now been cleared for the next rally in crypto prices.
While bitcoin in particular has fallen significantly from its near $20,000 highs of 2017, the markets are still up more than 600% in the last 15 months.
Interestingly, Enneking also highlighted the declining share of cryptocurrency markets tied up in bitcoin, which has fallen from a 45.7% share, down to 44.3%. According to Enneking, this reflects the growing prominence of other cryptocurrencies, as the sector continues to mature and grow.
The report concluded that market conditions were now more favourable to a rebound in price. At the time of writing, trading across cryptocurrency markets had in fact grown, with each of the top 10 cryptocurrencies posting gains on the day.
The news will be welcomed by those holding bitcoin and other cryptocurrencies, as well as cryptocurrency funds looking to regain ground lost in early 2018.
With the consolidation seemingly complete, many will now expect markets to follow a similar Q2 growth trend as from previous years.