The wipe out was necessary but VCs were never your friends
As Bitcoin continues in the trenches of the $19-20K range, it is important to gain some perspective on the state of the market. In what most are describing as the worst bear market in the crypto industry's history, it is also an essential wipeout.
Let's face it, all the attention might be on Bitcoin right now but the truth is that there were too many useless and overleveraged cryptocurrencies in the ranks.
Luna's wipeout was just a precursor for a market that was in dire need of deleveraging. Alas, the victims of these messed up situations will not take kindly to this truth but most projects were doomed by design.
Luna, currently Lunc, holds the unwanted title of being one of the precursors of this bear market but even without it, I think we would have still experienced this.
If you look back at the last couple of bear markets, you will find that they're all 4 years apart, last about the same length of time and always wipe out the weak hands.
The bear markets also wipe out projects built on weak foundations with fragile fundamentals and hyped promises.
Sometimes I feel like the bear market is a tool that the universe uses to wipe out projects that are drowning in their own hubris. The crypto market needs a reset and a bear market hits the switch for everyone.
There might be hope
Institutional investors that I must admit, I was excited about their participation, actually played a part in getting us into this mess. If you recall, what was described as the "Luna Attack", was basically an exploit by VCs that wanted to cash in their profit.
Now we have JP Morgan claiming that the market is almost deleveraged. Talks about a healthy market after the recent wipe out are already underway.
According to a Cointelegraph correspondent;
The deleveraging of major crypto firms, where their assets have been sold either willingly, in a rush, or via liquidation, began largely in May when the Terra ecosystem collapsed and wiped out tens of billions of dollars. Since then, crypto lenders BlockFi and Celsius, and investment firm Three Arrows Capital have run into their own problems.
They are basically saying that all the projects that got rekt deserve to be rekt and also that when all the wreckables are out of the way, we will see the sunshine. They are right.
Further down the publication, they also asserted that the activities of VCs likeSam Bankman-Fried (SBF) of FTX and others have "bailed out" the market.
From where I'm standing, it looks like VCs got us here in the first place. it is kind of like how big Pharma creates a virus in the lab, releases it and then creates the cure to look like heroes but also rake in billions of dollars in the process.
With rumours circulating about SBF's interest in buying the dead assets of Blockfi that he also offered a revolving line of credit, as well as 3AC and Celcius biting the dust, it is hard to see how Venture Capitalists are the "good guys" in this situation.
At the end of the day, all the market has proven is that the real value in crypto is on the blockchain level. The builders continue to build and that's all there is to it.
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