Bits + Bips: Why It's Time for Crypto Traders to Be Patient - Ep. 782
Feb 12, 2025
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Sal Ternullo, Managing Partner at A100x Ventures, offers keen insights into the volatile crypto landscape. He discusses the complexities surrounding Ethereum’s potential short squeeze and examines the real implications of SOL's unlocks. Ternullo believes the fear related to SOL unlocks is overstated and advocates for a shift away from memecoins. The conversation dives into market misinterpretations of altcoin performance and the Growth Value Ratio’s insights, as well as the effects of macroeconomic factors like Trump’s tariffs on crypto trading.
Market sentiment is mixed, demanding patience from investors as key catalysts for a rally remain elusive, especially for altcoins.
Trump's proposed tariffs have sparked debate, with some viewing them strategically while others caution about their negative impact on markets.
Ethereum's volatility is heightened by substantial short positions, raising speculation about a potential short squeeze amid bearish sentiment.
Deep dives
Market Sentiment and Patience in Altcoins
Current market sentiment reflects a mix of optimism and caution, particularly concerning altcoins. Many altcoins have suffered substantial declines, leading to poor sentiment and high volatility, which makes holding these assets risky. Market observers emphasize the need for patience as the anticipated 'trigger' for a significant rally is still missing. Without clear catalysts, many investors find it challenging to hold substantial positions in altcoins.
Impact of Tariffs on the Market
Recent discussions around tariffs proposed by Trump have elicited varied reactions in the financial markets. The shift from universal to bilateral tariffs is viewed by some as a more strategic approach, aiming to open foreign markets for American goods. Analysts point out that markets generally react negatively to tariffs, with historical evidence showing significant drops in futures when such news breaks. However, there is a belief that as the markets become accustomed to these announcements, their impact may diminish over time.
Ethereum and Liquidation Concerns
Ethereum is facing heightened liquidation risks, with substantial short positions contributing to its volatility. The strong reliance on Ethereum within decentralized finance (DeFi) means that adverse market movements can lead to significant sell-offs, disproportionately affecting its price. Many market participants speculate on the potential for a short squeeze, given the extreme bearish sentiment currently surrounding Ethereum. This could lead to a rapid recovery in its price, particularly if positive catalysts emerge.
Solana's Unlocks and Market Dynamics
Solana is experiencing challenges related to unlock events which are expected to increase the availability of its tokens on the market. While some believe that the unlocks will be absorbed by long-term investors, concerns persist about the potential downward pressure on Solana's price. A significant number of tokens unlocking concurrently may aggravate current market conditions, making it difficult for Solana to exhibit sustained upward momentum. Observers remain cautious, awaiting clearer indicators of demand and market stability for Solana.
The ETF Landscape and Future Prospects
The evolving landscape for exchange-traded funds (ETFs) involving cryptocurrencies suggests increasing interest and potential for new products. With several crypto assets poised to transition into ETF structures, experts predict that acknowledgment from regulatory bodies like the SEC could pave the way for significant new investment opportunities. The anticipated introduction of futures contracts for various cryptocurrencies, including Solana and XRP, reflects a broader trend toward legitimizing these assets in traditional finance. Market participants remain hopeful that the establishment of ETFs will bring new capital into the ecosystem and enhance overall market liquidity.
Crypto markets are at a crossroads. Is Ethereum primed for a short squeeze, or is its dominance fading? Are the SOL unlocks a real risk, or is the panic overblown? And did we already have an alt season without realizing it?
In this episode, hosts James Seyffart, Alex Kruger and Ram Ahluwalia sit down with Sal Ternullo, managing partner at A100x Ventures, to break down the biggest questions facing traders today. They discuss whether Trump’s tariffs are impacting ETH, why the market might be misreading SOL’s unlocks, and how traders keep falling into the same traps—losing money despite crypto’s explosive gains.
They also debate the real reason altcoins haven’t performed as expected, why memecoins might finally be dying off, and what the Growth Value Ratio reveals about the market’s future. Plus: the implications of Elon Musk’s bid for OpenAI, and whether Arweave’s AO can seriously challenge ICP.
Show highlights:
3:33 - Why Ram likes what Trump is trying to accomplish with the tariffs
10:35 - Why ETH got hit so hard with the tariffs and whether there’s a squeeze coming
15:24 - Whether the market will see an alt season
21:47 - Why Sal believes that the SOL unlocks are not a big deal and why he’d like to see a shift away from memecoins
25:09 - Why Ram thinks that crypto markets don’t have a clear narrative in the near future
27:28 - Why Alex is concerned about the SOL unlocks
32:19 - What the growth value ratio is teaching us about the state of the markets
40:59 - How the potential Kanye West memecoins is another example of why Sal doesn’t like this space
46:39 - Whether Arweave’s new project AO can compete with ICP
48:04 - How Elon Musk is running so many projects, plus bidding for OpenAI
55:26 - James’ analysis on the likelihood of various crypto ETFs being approved
1:03:01 - Why Alex thinks this is the perfect time to “be patient” in the markets
