Veteran cryptocurrency investor Arthur Chong suggests that the era of severe downturns and prolonged bear markets in digital assets may be behind us.
Arthur Chong, CEO of DeFiance Capital, said the crypto market may be entering a new phase of maturity where it is starting to resemble the stock market in its behavior. He noted:
It is possible that the crypto market will evolve and we won’t see the extreme 70-80% declines every few years. Instead, we may see steady growth similar to the S&P 500 after the 2008 financial crisis.
Chong stressed that the U.S. stock market, barring a crash during a COVID pandemic in 2020, has mostly shown a gradual upward trend. The big crashes predicted by pessimists did not materialize, while returns were increasingly focused on large market cap stocks, and those with smaller market valuations remained in the background.
If this trend persists in the crypto market, Chong believes that future bull markets may not lift all altcoins as has happened in the past. Instead, only a few winners will see significant gains, similar to the way Nvidia performed in the stock market:
Most altcoins may not be good investments, but some will provide exceptional returns, as Nvidia does periodically.
Despite current market conditions, Chong is optimistic about the future of cryptocurrencies. He believes Bitcoin (BTC) and Etherium (ETH) are undervalued, especially since they are the only two cryptocurrencies free from regulatory uncertainty:
The market hasn’t fully realized that BTC and ETH are the only cryptocurrencies without regulatory issues, making them attractive to traditional finance.
Metaplanet is aggressively expanding its Bitcoin holdings through an unconventional $5.4 billion capital raise, positioning itself as a leading BTC proxy in Asia.
A growing number of publicly traded companies are turning to XRP as a potential reserve asset, signaling a shift in how institutions view the utility of digital assets in treasury management.
BlueBird Mining Ventures, a London-listed firm traditionally focused on gold, is making headlines after announcing it will liquidate its gold reserves and begin accumulating Bitcoin as a treasury asset.
Coinbase has taken another step toward boosting cross-chain utility by introducing wrapped versions of XRP and Dogecoin on its Layer 2 network, Base.