When There's Blood In The Streets (Nov. '21 Chartbook)

The last couple weeks have been a bit of a whirlwind. Massive deleveraging sparked a sharp and violent sell-off that the crypto market still hasn’t recovered from. Some would argue this was a necessary wash out as excessive optimism and bullish sentiment prompted tons of speculative buying. But even with most crypto assets sitting well off their prior highs, it’s hard not to step back and reevaluate if things have gotten a little bit frothy as of late. Adding insult to injury is the shifting macro backdrop that’s characterization served as a material tailwind for all risk assets, including crypto, over the last 12-18 months. As global liquidity growth slows and policymakers shift their rhetoric from “do whatever it takes” to “normalizing policy”, there’s several factors that could weigh on valuations going forward.

We’re adding this preface because, while our long-term conviction hasn’t swayed, it’