The FTX collapse has become the catalyst for a new bullish rally in the cryptocurrency market, according to Bernstein Asset Management analysts, CoinDesk reports.<\/p>\n
The bankruptcy of Sam Bankman-Fried’s cryptocurrency exchange<\/a> “eliminated the last tranche of toxic leverage” and motivated investors to focus on the importance of decentralization and non-custodial storage of digital assets, according to Gautam Chhugani and Manas Agrawal.<\/p>\n They believe macro catalysts\u2014weakness among regional U.S. banks and outflows from them into money-market funds and large financial institutions\u2014are working in favour of the leading cryptocurrency.<\/p>\n “Any potential misalignment, whether on the credit side of banks or on the sovereign assets side, … perfectly positions Bitcoin as a safe haven alongside gold,” the analysts said.<\/p>\n<\/blockquote>\n They note that since the start of 2023 the leading cryptocurrency has risen by around 80%. Ethereum prices have added about 76%. Only after activation of the Shapella hard fork<\/a> in April did the ETH price rise by 13%, pulling<\/a> the rest of the market along.<\/p>\n Gas fees on the Ethereum blockchain have tripled, reflecting ‘rising user activity and token prices in the post-FTX era,’ the analysts noted.<\/p>\n In their view, the new crypto cycle is not yet fully understood, but a number of positives have emerged. They point to another era of mining, ongoing Ethereum upgrades, and scaling solutions such as Arbitrum<\/a>.<\/p>\n “The prospect of building a new institutional financial stack on the blockchain remains a worthy goal, and serious participants remain focused on the long-term prospects,” the analysts emphasised.<\/p>\n<\/blockquote>\n In their view, the upcoming cycle will be the first in which institutional investors play the leading role.<\/p>\n\n
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