Looking ahead to a "year of rebuilding trust," Pantera CEO Dan Morehead said the cycle's lows for bitcoin and altcoins are behind us. Pantera Capital believes that investors should not be afraid of post-FTX cryptocurrencies as they embark on their “seventh bull market cycle.”
In his latest “Blockchain Letter,” dated Feb. 8, the asset manager’s CEO Dan Morehead predicted 2023 will be “the year of rebuilding trust.” With BTC price action retreating slightly after a 40% rally in January, some market participants remain adamant that a new macro low for the crypto asset is just around the corner.
While the timing of this has varied, there is still no consensus on how the market will bounce back.
For Morehead, however, the time has come to turn bullish on cryptocurrencies.
“Pantera has been through ten years of Bitcoin cycles and I’ve traded through 35 years of similar cycles,” he noted. This view, unlike most, dismisses the debate about the correlation of cryptocurrency prices with risky assets such as stocks. As Cointelegraph continues to report, this forms the backbone of several other predictions for 2023.
Morehead believes that although Bitcoin fell below the previous bull market all-time high after the FTX crash in November 2022, Bitcoin’s pullback from the latest all-time high has put the market in historical context. “The decline from November 2021 to November 2022 was the median of the typical cycle. This is the only bear market to more than completely wipe out the previous bull market. In this case, giving back 136% of the previous rally,” he wrote, alongside accompanying data.
A similar level of optimism has emerged in the decentralized finance space, though Pantera is prioritizing a year of “rebuilding trust” in centralized finance (CeFi). Morehead claims this will be necessary given the multiple business closures last year that spawned a bear market in cryptocurrencies.
“2022 is a year of boom and bust, especially as it relates to CeFi. In a matter of months, the world has seen the collapse of Three Arrows Capital, the collapse of Do Kwon’s LUNA, the bankruptcy of Voyager Digital, and the collapse of Sam Bankman- Fried’s (SBF) FTX empire fell apart,” he explained.
