Bitcoin clings to $17K as ARK flags ‘historically significant capitulation’
Bitcoin (BTC) and decentralized blockchains are “as strong as ever” in the wake of the FTX meltdown, says ARK Invest.
In the latest edition of its monthly newsletter, “The Bitcoin Monthly”, the investment giant came out heavily on BTC.
ARK: The FTX scandal could be the “most damaging event” ever
With BTC price volatility ebbing in December, the industry remains reeling from ongoing FTX contagion.
As lawmakers are just beginning to come to grips with the events, when it comes to Bitcoin, ARK is doubling down on its convictions – and strongly setting it apart from centralized alternatives.
“FTX’s fall could be the most damaging event in crypto history,” reads one of the latest report’s “key takeaways”.
While acknowledging that even Digital Currency Group (DCG) – one of its products, Grayscale Bitcoin Trust (GBTC), it recently acquired – “faces significant pressure” as part of the fallout, ARK delivered a key critique of what it called “centralized intermediaries.”
“ARK’s belief in decentralized and transparent public blockchains is as strong as ever,” it affirmed.
“FTX and other cases like Celsius and Alameda suggest that decentralization and transparency are essential as antidotes to the gross mismanagement that can be associated with centralized intermediaries, especially fraudulent ones.”
As such, despite being bearish on some on-chain metrics, there was reason to keep the faith in Bitcoin.
Examples to keep in mind include the resilience of long-term investors, a group that refuses to succumb to the temptation to sell despite recent BTC price falls.
“We believe this data point indicates holders’ long-term focus and high conviction, despite recent events. Today, long-term holder supply is 72% of bitcoin’s total circulating supply,” the report continued.
“A historically significant capitulation is underway”
Bitcoin’s realized profit/loss ratio also gained attention, and this now hits an all-time low, as Cointelegraph reported.
Related: ‘Imminent’ Crash For Stocks? 5 things to know in Bitcoin this week
Profit/loss ratio refers to BTC transacted on-chain in profit and loss respectively.
“Bitcoin found meaningful bottoms in all previous instances – 2011, 2015 and 2019 – where this metric reached <10%," ARK commented.
“November’s realized profit/loss data informs our view that a historically significant capitulation is underway.”
BTC/USD traded around $17,000 at the Wall Street open on December 6, data from Cointelegraph Markets Pro and TradingView showed, still trying to turn the level into firm support after days of indecision.
ARK’s CEO, Cathie Wood, doubled down earlier this year on a prediction that Bitcoin would reach $1 million by 2030.
The views, thoughts and opinions expressed herein are those of the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
