Crypto Market Expectations: Expert Perspectives from QCP Capital

Every week, countless predictions and charts are shared about cryptocurrency markets. However, there are also the experts in the field. The comments of investment firms, who handle this job in a much more professional manner than other independent analysts, are more valuable for many. So, what are the market expectations of the analysts at QCP Capital, who are experts in the field? How do they interpret recent developments? 

Cryptocurrency Commentary

Looking back at May, memecoins have been the most striking detail about cryptocurrencies. QCP analysts also touch on this topic. Tokens such as PEPE, GEN (Generational Wealth), RFD (Refund), and DMT (Dimethyltryptamine) caught attention last week and performed relatively well compared to the market. 

Coordinated buying, marketing and branding (creating a high memetic value), high liquidity/market value/FDV ratios, and chance (like Elon Musk’s encrypted tweets boosting DOGE (Dogecoin) or LADYs (Milady) prices) played significant roles in the recent memecoin success.

Bitcoin and BRC-20 tokens also made noise in May. BTC reached an all-time high in daily transactions on May 5th. This record-breaking success, with 568,368 transactions in a single day, hadn’t been surpassed since December 2017. Meanwhile, BRC-20 tokens, launched last month, achieved an unprecedented success. 

Ripple Case

Ripple (XRP) managed to publicize the “Hinman Documents” revealing the SEC’s views on the status of Ethereum (ETH) after the famous speech by Bill Hinman (former SEC director) declaring ETH is not a security. These will be published on June 13th, and it will be seen whether the SEC contradicts itself. 

Moreover, this situation will put the SEC in a difficult position in court because the phrase “not a security” was used for ETH at that time. Today, Gensler classifies all altcoins as securities and investment contracts based on his personal opinion. 

However, this matter doesn’t only concern altcoins from a lawsuit perspective. The release of the documents on June 13-14 coincides with the Fed decision. If there will be any enthusiasm in the market, this date could be the right time. QCP analysts expect volatility to increase to a desirable level in mid-June. 

China and Cryptocurrencies

There is a widespread belief that Chinese altcoins will rise just days, even hours, before the promise of Hong Kong. It is being discussed that China is considering re-allowing proof of work (PoW) mining for BTC, Litecoin (LTC), and Dogecoin (DOGE), and this may cause a drop in hashrate rates in the US. If this happens, lower energy costs could bring all these miners back to their homelands. Operations in Kazakhstan and other countries could also be relocated. 

Previous photos of miners gathering and leaving China after the 2021 and 2022 mining ban may not be as they appear. Upon closer examination, the machines turn out to be Antminer V9s. In reality, some of these miners were getting rid of old miners (S9 Antminers – 4 Th/s) at that time and were replacing them with newer models (S19 Antminers – 95 Th/s). Also, in images showing mining activities that were understood to be being demolished at that time, it was actually setting up new activities, as can be understood from the presence of new cable reels. Despite the past mining ban, China today is the world’s second largest Bitcoin miner after the US. Chinese social media applications and news sites are now displaying BTC prices in yuan officially, showing a more open approach to cryptocurrency. Recently in Hong Kong, the majority of participants accepted the proposal to allow licensed trading platform operators of the Securities and Futures Commission (SFC) to serve individual investors from June 1, 2023. We believe that the increasing regulatory collaboration between Hong Kong’s SFC and China’s Securities Regulatory Commission will also provide Chinese individual investors with access to the crypto markets. Chinese coins like TRON, Conflux and NEO are also performing well in the market. Tokens worth watching include Nucleon, which offers liquid staking on Conflux, and Elastos, which announced a strategic partnership with Alibaba Cloud in April. In general, these developments are positive not only for the majors, but also for Chinese altcoins, excluding potentially negative macro factors such as the US debt ceiling.