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Arca Debunks 10 Most Popular Crypto Bear Theses

Arca Debunks 10 Most Popular Crypto Bear Theses
Source: Adobe/jcalvera

The common digital assets bear market theses don’t have “a lot of substance” and are “most likely inaccurate,” according to Jeff Dorman, the Chief Investment Officer (CIO) of US-based investment management firm Arca.

While many seem convinced that we are now in a bear market, given the drop in prices, as well as in sentiment – “here’s the problem – we can’t come up with a single reason that validates why the market is all of a sudden so convinced that digital assets are going into an extended funk,” Dorman wrote in a blog post.

“While many are calling for a bear market — the data simply suggests otherwise. Whether or not this is enough to attract new buyers remains to be seen,” he added.

Gathering the opinions of industry leaders, funds, and traders about the specific bear thesis that makes traders convinced of the upcoming price declines, Arca listed the ten most popular bear cases, along with the reason why it might be incorrect.

1. “China intends on killing digital assets”

The CIO argues that China’s most recent crackdown is focused exclusively on Bitcoin (BTC) miners and digital asset exchanges that offer leverage, and not the actual underlying assets themselves.

Therefore, per Dorman, “it’s difficult to believe that this entire global asset class is at the mercy of a single government interjection. In fact, most market participants agree that long-term results from China’s potential exodus are actually positive, from a redistribution of hash power globally to more [environmental, social, and governance] ESG-friendly mining facilities.”

“Well, we’re 6 weeks into this selloff and most assets are already down 40%-70%. It would be reasonable to argue that we have already bottomed,” said Dorman.

2. “Massive regulatory pressure from the US”

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