As cryptocurrencies continue to experience massive volatility, Barry Silbert, founder, and CEO of Digital Currency Group (DCG), the parent company of Grayscale and other crypto firms, believes that the next move of the asset class will be determined by what happens in the stock market in the coming weeks.
“Where the crypto market goes from here is completely dependent on the stock market over the next couple weeks,” Silbert tweeted today.
Silberts latest statement follows an earlier post on Twitter where he described the current crypto market meltdown as being healthy.
Reacting to the recent market crash, Silbert stated that many crypto traders had become long-term investors, which he considers to be healthy.
Crypto & Stock Market Plunge in May
This month has not been the best for crypto and stocks, as both markets have experienced a series of crashes that saw billions of dollars liquidated.
The stock market‘s plunge was caused by several factors, including investors’ worries of rising inflationary pressures, which may prompt the Fed to withdraw its support for the assets.
The crypto market‘s recent volatility, on the other hand, was triggered by China’s long history of FUD on crypto ban and related regulatory issues, which resurfaced last Wednesday.
Although China's stringent measures toward cryptocurrencies have been instrumental in the current market dip, Elon Musk, the CEO and founder of popular electric car manufacturer Tesla, has continued to swing the prices of cryptos via his series of tweets in the past week.
Part of Musk‘s shot at the asset includes his sudden concern about the carbon footprint of Bitcoin’s mining operation, prompting him to announce that Tesla will reverse its February decision to accept Bitcoin payments for its cars.
Partial Recovery
Stocks and cryptocurrencies are gradually recovering from last weeks massive downtrend. Dow Jones futures, S&P 500, and Nasdaq futures saw a slight boost this morning.
Similarly, the largest cryptocurrency by market capitalization, Bitcoin (BTC), also rose tremendously from yesterdays dip, which saw the cryptocurrency tumble to $31,179 after Huobi suspended its products and services in certain countries.
Bitcoin is trading above $36,000 at the time of writing, as Russia moves to allow cryptocurrency to be used as a contractual means of payment in the country.