Su Zhu, CEO of crypto investment fund Three Arrows Capital, is providing his insight into what caused Bitcoin’s collapse in late May and where the crypto markets are headed next.
In a new interview on the Uncommon Core podcast, Zhu says that a confluence between Bitcoin’s soaring price action and a series of bearish news likely triggered the big sell-off that shaved off over 50% of BTC’s value.
Zhu references the potential Bitcoin mining shutdown in China and Tesla CEO Elon Musk’s tweets lambasting the flagship cryptocurrency for what he sees as environmentally unsustainable properties.
“I think there was a lot of news that came out around then that was a bit bearish especially out of China regarding mining, but then also in the US with Elon’s tweets about Tesla and Bitcoin energy usage… Those are not the proximate causes, but they were some of them, and I do think that the market took that as a shelling point to start taking profits. So I think that it was a culmination of that plus the fact that people who had been buying throughout kind of said ‘Okay if I just wait then I could get it at a much lower price, so I’ll just wait.’
So I think it was a culmination of those two factors that put it through, but if you look at the way that the markets have bounced, you can see those buyers are still there. It’s just a matter of what price they’re going to get. During the beginning and the mid part of this run, they kept having to buy at higher and higher prices, and this time they managed to get some at lower prices than before.
Bottom line is there is still a tremendous amount of buying demand.”
Within the interview, Zhu asserts “the bull run definitely isn’t over,” and that decentralized finance (DeFi) is about to make a huge infiltration into the financial establishment as investors discover the superior yields and instruments.
According to the crypto veteran, the recent survey showing hedge funds are planning to dump hundreds of billions of dollars into crypto is also a mega bullish catalyst that could strengthen the digital asset markets immensely.
“The reality is that once you have this infiltration and people are used to this idea of digital scarcity and this kind of floating around, then you will have a whole new set of natural buyers that come in when there’s dips. These people are trading these assets as just like instruments like copper or another commodity. They will also find reasons to buy it and also find reasons to sell it, and so I think that whole process is something that is very, very bullish long term because it broadens the base of holders massively.”
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The post Crypto Guru Su Zhu: Here’s What Caused Bitcoin Crash – And Here’s What’s Next appeared first on The Daily Hodl.
