Weng Xiaoqi, CEO of Xinhuo Technology: There is no need to be overly pessimistic. A sharp drop and rebound is a typical feature of a bull market.
Weng Xiaoqi, CEO of Xinhuo Technology, stated to the media today that after the sharp drop in the early hours of October 11th, mainstream coins such as BTC and ETH rebounded rapidly, with some coins even reaching new highs. Bull markets often experience sharp drops, followed by rapid rebounds, which is a standard feature of bull markets. On the contrary, bear markets are characterized by continuous declines. Against the backdrop of continued interest rate cuts and the release of liquidity, the industry fundamentals have not reversed.
At the same time, Weng Xiaoqi believes that the true scale of the liquidation in this crash far exceeds 20 billion US dollars, with many institutions and large holders being liquidated, causing a short-term liquidity crisis in the industry. In the short term, there may still be considerable volatility, and historically, it is not ruled out that there may be a second bottom confirmation after a major drop. Non-professionals are not encouraged to use leverage, and one should always be cautious of the market.
On the other hand, Weng Xiaoqi believes that there is no need to be overly pessimistic. The liquidation also brings opportunities to the industry, indicating that the power of repeated bargaining on the market has been weakened. After the market forms a direction during the consolidation phase, the momentum may actually be stronger.
Currently, the prices of many cryptocurrencies are already lower than the cost price of the DAT company's position before. Taking ETH as an example, the average holding price of BMNR is over $4500, while the current price of ETH is around $4100, which is favorable for DAT companies that have not yet established positions.
This crash was caused by an overreaction to Trump's TACO diplomacy, and there is still a high possibility of volatility in the short term, so market risks need to be monitored. However, after enduring continuous political fluctuations, the market will become desensitized to stress, leading the industry into a more stable development.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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