Su Zhu Sees Weakening Bearish Sentiment as BTC Nears $60K

Su Zhu, co-founder of the now-bankrupt cryptocurrency hedge fund Three Arrows Capital (3AC), recently shared an optimistic view of the current market conditions. He pointed out that the previously dominant bearish sentiment in the market is starting to weaken due to a combination of factors. 

Notably, macroeconomic fears have begun to subside, driven by the improvement in global economic indicators. Additionally, ongoing peace efforts in Gaza have fostered a more stable geopolitical landscape, which has historically influenced investor confidence. Zhu believes that these developments are helping to calm the market and reduce the pervasive fear of continued declines.

Another significant element in Zhu’s analysis is the conclusion of the typical summer lull in trading activity. This seasonal trend, where market volume tends to decline, is now coming to an end, which could signal renewed trading interest in the months ahead. Moreover, Zhu suggested that the market has undergone a period of high volume and liquidity flushout, which is now easing. According to him, this flushing process has allowed investors to reach a level of comfort with the idea that the current market cycle has completed, potentially setting the stage for future growth.

Looking ahead, Zhu also expressed anticipation regarding the upcoming release of Changpeng Zhao, the former CEO of Binance, who is expected to reenter the industry in a significant way. His potential return could generate further excitement among investors. As Bitcoin nears the $60,000 mark, Zhu emphasized that the charts are beginning to look more favorable, particularly to traditional financial investors. This, combined with the various market developments, signals a potentially bullish phase ahead, where Bitcoin and other cryptocurrencies might regain momentum.

This renewed optimism follows a period of volatility for Bitcoin, which recently saw its price drop 32% from its all-time high. Analyst CryptoJelle pointed out that such pullbacks are not uncommon during bull markets. During Bitcoin’s 2016-2017 bull market, the cryptocurrency experienced several corrections, with pullbacks of 43%, 40%, and 31% recorded during its overall bullish trend. 

These pullbacks were seen as part of the natural market cycle, often signaling the start of an upward surge. Similarly, during the 2020-2021 bull market, Bitcoin saw an average pullback of 24%, with corrections ranging from 15% to 32%. This trend highlights the resilience of Bitcoin, even during periods of notable price fluctuations.