Jack Niewold, founder of crypto analysis newsletter Crypto Pragmatist, has come to Twitter to discuss market bottoms indications. He began by noting that before Three Arrows Capital’s blowup, he questioned a lot of cryptocurrency OGs about how to spot market bottoms. They found 14 signs of a bottom, whereas we had only witnessed 4 at the time. As of today, each and every one of the fourteen signals has been activated.
Large investment funds collapsing is the first warning indicator, according to Niewold. Such examples include A16z, Sequioa, Chamath, Tiger, Tribe Capital, Coatue, Softbank, Paradigm, Ark, 3AC, and most recently, Alameda and FTX.
The second indicator is a state of “Max Boredom,” as described by the crypto specialist. He said that the period before the FTX blowup was more boring than during the FTX blowup itself. Low on-chain activity, stagnant follower accounts, a dearth of fresh entrants, and limited chances in the industry.
Niewold further on the ETH chart by noting a multiple-cross of the Weekly 200 SMA. And then there’s the fact that retail interest has been dwindling, notably on NFT exchanges. A similar trend of declining activity may be seen in the crypto community’s social media channels. Social media engagement and fan bases for crypto influencers have been on the decrease.
Crypto is presently in the process of dying slowly. Lack of optimism, with no buyers and no positive drivers in sight, and as a result, market volatility will be minimal and liquidity will be poor. More so, the crypto industry has seen a large number of layoffs in companies all year long.
Next, more and more individuals are saying they plan to exit the business. Following the FTX debacle, several users on Twitter said that they could be done with the cryptocurrency industry for good. This is what Niewold refers to as the “fear/despair” stage.
