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The end of May puzzled the crypto industry with a notable bearish coup on the exchanges. The top 25 cryptocurrencies showed a palpable decline in the last trimester of May. On May 22, Bitcoin fell below $8,000 for the first time since April 18. Ether and Bitcoin Cash sank by 14% in a week, EOS by 6%, and XRP by 8.5%. The only winner that week was TRON (TRX), which reported a slight increase in its rates.
The trend of one of the main market health indicators, the ratio of the Ether and Bitcoin pair, also changed to a downward trend. Because of this, other altcoins based on the Ethereum blockchain and, therefore, partly dependent on its positions, may fall sharply if the Bitcoin rate continues to decline. At the same time, the cumulative market capitalization decreased to $322.5 billion, sagging by 14% compared to the second trimester of May.
What should traders do on a market that has been clutched by bearish paws? In recent times, venture investors have become pretty skilled in cryptocurrency related issues and are already strongly advising traders what to buy, what to keep and what to sell. Although this trend was not so evident among large fiat investors back in January.
For example, Spencer Bogart, a partner at Blockchain Capital, believes that the current situation on the exchanges is beneficial for a successful purchase. "Since Bitcoin has recently been used more and more often and it still has many institutional interests, it is worth investing in it. All the big banks are trying to work with it, offer it to their clients. Some open trading platforms. A deeper institutionalization of Bitcoin is generally positive," the speaker said.
Despite the descending dynamics of the world's first cryptocurrency, Bogart is very bullish about his future. "Can Bitcoin be cheaper? Certainly. But do I think that in a year its rate will be higher? Absolutely sure," he explained in an interview for CNBC.
Positive forecasts, however, do not apply to altcoins. "Many cryptocurrencies are overvalued and unreliable. There is a chance that they will 'work out,' but they have many obstacles to overcome," Bogart said.
Another venture investor recommends taking a closer look at Cardano (ADA), TRON (TRX), IOTA (MIOTA), and NEO (NEO).
Interestingly, Spencer Bogart is rather cautious when speaking of Ethereum. "The thing is, there's a lot of ICOs on the Ethereum blockchain. It is not known what will happen to these projects and how this will affect the rate of Ether," he commented. "On the other hand, I would hold such big players as Ripple, Bitcoin Cash, and EOS in my wallet."
Other crypto enthusiasts also express rather cautious forecasts. "What are we to do in case of a bearish trend, which, in the medium term, is not confirmed by anything? It is definitely not worth buying cryptocurrencies in speculative order. If you are going to take something for six months or a year, then do not take anything. If you are already sitting in a long-term portfolio strategy, then hold, because in a short-term trend, it is unclear whether it will be possible to jump out and jump in again at a more favorable price. Selling only makes sense if you are a professional trader. But even they can trade, in fact, only on technical rebounds, so in any case, it is better to keep assets. In general, my recommendation is to pay attention to altcoins with low capitalization, because the market is now settling down, and the altcoins are sinking far faster after Bitcoin. If your goal was to redistribute your portfolio, then you can take advantage of the bearish trend," Dmitry Karpilovsky, founder of the CryptoNet professional community of crypto entrepreneurs shared his opinion with DeCenter.
Each trader decides for themselves what to do under the conditions of a recession in the market. The most important thing is to correctly build cryptocurrency portfolios and not to panic if there are fluctuations in the market. Especially on such a volatile market as that of cryptocurrencies.