Bitcoin tumbled 6.45% to $47,837, dampening any hope for an end-of-year rally. Crypto in general took its lumps, with Ethereum tumbling 6.25%, litecoin losing 8.31%, and ripply going down 7.77%. Crypto Exchange Binance noted $119 million in liquidations.
Even though bitcoin is down $20,000 on its 2021 high, there’s still plenty of reason to be optimistic about 2022. The price drop has caused some sell-offs and liquidations, and the futures market is in disarray, but bitcoin remains up on the year, and the widespread acceptance of cryptocurrency continues to gain traction. Star athletes are taking some of their salary in bitcoin, countries like El Salvador have made huge strides to legitimize bitcoin, and Web3 continues to spark the imagination of many.
There’s also evidence to suggest that, despite the current swings, long-term holders of bitcoin have largely held on. Data Analytics firm Glassnode explains in a Monday newsletter that, “Such on-chain behavior is more typically observed during bitcoin bear markets, which in hindsight are effectively lengthy periods of coin redistribution from weaker hands, to those with stronger, and longer-term conviction.”
Crypto equities tend to weather these storms better than futures or pure plays on individual currencies. If bitcoin gets supplanted as the top dog of the crypto universe, then firms like Black (SQ), Marathon (MARA), and Riot Blockchain (RIOT) are still going to be able to adapt.
The recent markets create an excellent opportunity to get exposure to the space while it is on a dip through the VanEck Digital Transformation ETF (DAPP). DAPP holds all three of the aforementioned companies, as well as other holdings that intersect with the crypto space without being directly tethered to bitcoin’s volatility. This is a space that is going to continue to grow, despite its bleak day on the market.
“Advisors are finally giving this space the attention it deserves,” said Ben Cruikshank, head of Flourish, in an interview. “They really can’t afford to wait any longer.”
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