Concordium founder advises against anticipating an exciting cryptocurrency rally, regardless of Bitcoin ETF developments.

The upcoming cryptocurrency bull run is expected to differ significantly from the previous one, and investors should temper their expectations regarding a swift surge in cryptocurrency values.

This perspective comes from Lars Seier Christensen, the founder of the enterprise blockchain Concordium, who shared his insights with Cointelegraph in a recent discussion.

While much of the crypto market is optimistic about the numerous proposed spot Bitcoin (BTC) exchange-traded funds, Christensen expresses skepticism about their approval serving as an immediate catalyst for the crypto markets.

“Even if a Bitcoin rally occurs — I don’t think it’s reasonable to assume that everything will rally alongside it.”

“Does that imply that Ethereum and many older altcoins will also experience a rally as a result? I think it’s highly unlikely,” he added.

NEXT DATES TO WATCH:
The middle of October marks significant dates to observe, particularly October 16th. (& @GlobalXETFs’ Oct 7)
Additionally, we anticipated delays regarding this round of spot #Bitcoin ETF filings. Approval this week would have been unexpected. pic.twitter.com/i14fg8FWun

— James Seyffart (@JSeyff) August 31, 2023

Christensen noted that although digital asset prices have declined over the past 18 months, corporate interest in blockchain technology remains strong.

This indicates that the next major advancement for the industry is unlikely to be characterized by a particularly “exciting” rally, akin to the price surges seen in 2021 — but rather a more gradual growth expected over the next 18 months, stating:

“The primary reason corporate entities require a crypto asset is to facilitate their operations on a specific blockchain. Therefore, it’s evident that they do not urgently need a particular cryptocurrency to significantly increase in value.”

However, not everyone shares Christensen’s viewpoint.

Ben Simpson, the founder of the crypto education platform Collective Shift, mentioned that there is a wealth of data and indicators suggesting that we are already observing the early phases of a Bitcoin bull market.

“The drawdown from the All-Time High chart and the Market Value to Realized Value Ratio (MVRV) indicate we’re in the final stages of accumulation, which often precedes a bull market,” Simpson explained.

Regarding the assets most likely to experience substantial growth, Simpson believes the next bull market will benefit Bitcoin, Ether (ETH), and application-specific tokens, particularly in sectors like gaming.

“DeFi tokens carry risks but present significant upside potential, and I believe Bitcoin will emerge as the ‘silent winner’ amid broader adoption, making it my most optimistic investment.”

“A Bitcoin ETF won’t influence the price” pic.twitter.com/ArSTwskEec

— Ben Simpson (@bensimpsonau) September 13, 2023

The past two years have been challenging for the cryptocurrency sector. An increasingly hawkish Federal Reserve, coupled with several high-profile collapses such as FTX and Celsius Network, has led to a decline in investment within the industry, resulting in lower prices for crypto assets.

With the U.S. Federal Reserve recently deciding to halt interest rate hikes, eToro Markets analyst Josh Gilbert views the broader macroeconomic outlook with optimism.

BREAKING: THE FEDERAL RESERVE HAS JUST PAUSED ITS INTEREST RATE HIKES AND WILL MAINTAIN CURRENT INTEREST RATES pic.twitter.com/meRkOhhWfh

— GURGAVIN (@gurgavin) September 20, 2023

“We’ve finally entered an improving macro environment with potential rate cuts on the horizon from central banks worldwide. As rates begin to decrease and inflation eases, investors will be more inclined to take risks, allocating more capital into financial markets — with crypto at the forefront,” he stated.

Like many market analysts in recent months, Gilbert suggested that the upcoming year appears poised for a rally.

“2024 could be a robust year for Bitcoin and the wider crypto market. The Bitcoin halving is central to this theory and serves as a major catalyst for optimistic investors.”

However, Tina Teng, a market analyst from CMC Markets, explained that it is premature to speculate about the possibility of significant gains on the horizon. Instead, investors should prepare for a new wave of uncertainty.

Related: China experiences its worst capital flight in years, but could it boost Bitcoin?

“It’s too soon to declare that we’re at the onset of a bull market in crypto. This will depend on the macroeconomic environment and whether central banks are willing to conclude their rate hike cycles to provide sufficient liquidity to the markets,” Teng stated.

“Tightening monetary policy has contributed to the decline in riskier asset classes, including startups, small caps, and cryptocurrencies. Historically, the cryptocurrency market has thrived during the Fed’s rate cut cycles, not during hikes.”

“The soaring government bond yields and inverted bond yields consistently signal economic uncertainty ahead.”

#Bitcoin is approaching realized loss on the 50-day moving average of the RPV ratio.
If past cycles are any indication, this will be the last occurrence until the next cycle peak!
Each cycle, Bitcoin makes a… pic.twitter.com/Rrw7wYKbvA

— CryptoCon (@CryptoCon_) September 1, 2023

Teng asserts that for a bull market thesis to be validated, Bitcoin must surpass the 50-day moving average and capitalize on another upward surge.

Magazine: How to safeguard your crypto in a volatile market — Insights from Bitcoin veterans and experts