Crypto Investor Briefing – July 2021

The month of June saw some continued overall weakness in the crypto markets carrying over from May, with weaker hands continuing to pass their assets to institutions and longer term players. The downward trend seems to have potentially bottomed out towards the last week of June with some hopeful signs of a recovery in the last few days of the month.

Reasons for the sinking prices are usually being explained by negative news from China with crypto crackdowns which continue to depress prices for the moment. On the technical side, analysts have been watching for the formation of the ‘death cross’ (when a shorter term moving average crosses downwards through a longer term moving average) which could signal further weakness to come before any return to more bullish moves. But as Warren Buffet famously stated, it is wise for investors to be ‘fearful when others are greedy, and greedy when others are fearful’. ‘Buying the Dip’ or Dollar-Cost-Averaging into weakness can be a good strategy for longer term believers in this space.

Eyes may return to Ethereum during July as the network prepares for arguably one its largest upgrades for some time. The London hard fork to introduce EIP-1559 is expected to take place some time this month barring any major issues, and is believed to change the economics of Ethereum such that it now becomes a deflationary asset. The changes should remove much of the volatility and uncertainty associated with paying gas, the fee required to successfully conduct a transaction on the network. EIP-1559 also introduces a fee-burn model for each transaction, that may add a deflationary element to the ETH currency, and correspondingly increase its appeal as a safe-haven, hard asset. Certainly one to watch this month!

Rick Behl 

CTO, Tokenomy

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Crypto Investor Briefing is a Tokenomy newsletter, the content is for informational purpose only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.


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