It is not hard to believe that the situation could get worse. But it was hoped that the crypto winter was almost over. A bearish season that has been going on for far too long now seems to want no end, worrying even Kathleen Breitman, Tezos co-founder.
At the moment, it seems that cryptocurrencies are trying to overcome the bearish season that has seen them in the spotlight throughout 2022.
Solana closed the previous week with +10% along with Bitcoin, which finally managed to break through the USD 21,000 wall. Ethereum also seems to have recovered, leaving the territory around USD 1,000-1,200 and settling at around USD 1,600.
Then there are Ripple and Cardano on the rise. With the former traded at 49 cents and the latter at 42 cents, finishing with BNB which closed the previous week with +13.71%. In short, the market would seem to be breathing again. Or rather the data would show this.
However, among the myriad of experts crowding the sector, one wanted to comment a few days ago on the global trend of the Web3. And, on how crypto winter could risk getting even worse, despite the slight recovery of some of the most famous digital currencies.
This is Tezos co-founder Kathleen Breitman. Who states emphatically how we will soon see several crypto companies disappear due to this global tension and the overvaluation of some of them.
This might be hard to accept, but her reasons are more than valid.
Tezos, still bearish?
Judging by the current situation, it does not seem that Tezos is experiencing its heyday.
Analysing Tezos’ prices recently, we can see a drop in price due to the return of the bearish. The trend line has been upwards for the past few days. But on Friday it proved extremely discouraging for the market as the sellers predominated and brought huge losses within a few hours as they downgraded the price to $1.38.
Just think that until a few days ago, the price was reported to be hovering around $1.46.
Trading volume also saw a drop, with the value standing at $43 million and a market capitalisation of $1.31 billion for XTZ/USD.
And the question remains: is another price drop possible? The answer is yes, as the bearish momentum is strengthening again.
Who is the co-founder of Tezos?
In such a context, it is one of the co-founders of Stablecoin who is speaking out publicly.
It is Kathleen Breitman, wife of the other co-founder Arthur Breitman. Yes, for those who do not know, Tezos was founded by husband and wife.
Kathleen Breitman is, in fact, the CEO of Dynamic Ledger Solutions. A company that created the first version of Tezos, a blockchain-based smart contract platform with an on-chain governance mechanism that aims to incentivise and regulate exchanges between nodes.
Previously, Kathleen was a senior strategy associate for R3, a consortium of over 70 financial companies. So this is someone who certainly knows the industry. And, having also worked with Bridgewater Associates, Accenture and the Wall Street Journal, certainly knows her stuff.
Kathleen Breitman firm on worsening crypto winter
Despite some widespread data on the recent improved performance of some digital currencies, a further crisis cannot be averted. This is Kathleen Breitman’s line of thought.
On the other hand, we find ourselves in the midst of such a bearish season where many companies have already made headlines for bankruptcies and huge losses.
Let us remember Terra blockchain or Three Arrows, but not only. Because other strongly supported companies like Celsius also perished during the so-called crypto winter.
Not all of them were saved, and for those that seemed to be able to survive, the worst still seems to be coming.
Fed and interest rates: could they really make a difference?
We all know how the Fed has done nothing but raise interest rates this year and may even continue to do so next year!
However, even putting the interest rate hike ‘on hold’ may not be enough for the crypto world.
Yes, because in this diverse cryptocurrency landscape there is no more room for digital currencies and blockchains with dubious uses. Only the most useful and sustainable projects will survive the crypto winter.
If the Fed actually decides to suspend the rate hike, we could indeed expect an improvement from cryptocurrencies, but only the most useful and sustainable ones.
Venture capitalists: crypto companies overvalued
Another reason for the Tezos co-founder’s statement is the amount of (sometimes excessive) money circulating on the Web3.
Well, the influx of investors, the lower interest rates, pre-crypto winter, allowed venture capitalists to influence an exaggerated amount of crypto companies too positively.
Now that the landscape is becoming more complex, this positive ‘overvaluation’ and the idea of making easy money is starting to fade. Increasing the likelihood of the fall of blockchain-based companies that do not have sufficiently useful and sustainable business models.
All that remains is to watch and see if Kathleen Breitman was right.