TechFlow news, on September 5, Matrixport, a cryptocurrency financial services company, released its latest market analysis report titled "Entering the Altcoin Graveyard: A $3.4 Billion Crypto Cleanup is Coming."
The report notes that many people continue to ask: "Which altcoins should I buy?" Our answer has remained consistent: previous bull market altcoins are tainted by poor tokenomics and excessive unlocks. They may never return to their former highs, so we need a new narrative to drive the next generation of altcoins. In the meantime, maintaining exposure to Bitcoin makes the most sense.
In addition, in an April filing, FTX stated it held $3.4 billion in crypto assets. In last week's filing, FTX indicated its willingness to sell $200 million worth of crypto assets per week, as the company prefers returning fiat money to users rather than cryptocurrencies. This means FTX will likely continue selling assets through the end of 2023.
FTX is not the only major player selling off assets. Crypto venture capital funds are also under significant pressure to return capital to their investors. While some crypto venture funds have achieved returns of 10x to 20x, others have suffered substantial drawdowns, leading investors to prefer cashing out even at much higher valuations. For example, Multicoin Capital lost -91% of its value in 2022. These venture funds will likely remain significant sellers of altcoins and must liquidate their holdings.
