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Pantera Capital, a crypto investment firm, has announced that it will rotate back into altcoins from Ethereum for the first time since the spring.
The movement just like cryptos showed a modest rally in January after the market saw a rout in 2022, with Bitcoin losing more than 60% of its value.
Pantera Capital Turns Bullish on Altcoins
According to Pantera’s Co-Chief Investment Officer Joey Krug, the firm moved into Ethereum last year “to try to avoid further drawdowns,” but has now started to rotate back into altcoins that they believe will “outperform ETH over the coming cycle.”
The Liquid Token Fund, which typically invests 15-25 liquid tokens at a time, dropped 80 per cent in 2022, but is currently up 47 per cent this year.
Krug said 2022 was a "very rough year for risk assets in general" but the market was showing signs of recovery, pantera is optimistic about altcoins' potential. The Bloomberg Galaxy Crypto Index declined 72% in 2022 and rose almost 40% in January relative to the performance of the Liquid Token Fund.
The decision of the capital of Pantera to reduce its capital to altcoins also reflects the growing popularity and interest for decentralized finance projects (). Many of these projects are driven by altcoins, and society sees the potential to disrupt traditional finance and reshape the financial landscape.
The company's return to spare parts is taking place at a time when the market is showing signs of recovery, with numerous investors and traders closely monitoring the crypto space to detect any signs of a possible altseason season.
Created in 2013, pantera capital is one of the oldest investment companies in the cryptography industry and has a history of making knowledgeable investment decisions. Its recent move to altcoins underscores its trust in the potential of these digital assets and the future of the crypto market.
How's Altseason coming?
The start of a new altseason in the cryptocurrency market remains uncertain, as the hallmark of this phenomenon, stratospheric price jumps, has yet to occur. During the previous 2020-2021 bullish period, several alternative parts experienced explosive growth, some having seen their prices increase 100 to 400 times.
Despite a recent correction, Bitcoin continues to see momentum increase and its price remains 11% higher during last week. The leading cryptocurrency has maintained its dominance, as indicated by the Bitcoin Dominance (BTCD) index, which currently stands at 44.4. This index measures Bitcoin's level of control over the wider crypto market and has been trending upward since January 10.
To launch another alternative season, it would be crucial for the BTCD index to reverse its upward trend and fall below support level 38. That, however, is a rare event in the marketplace, with Bitcoin generally leading the general direction of the marketplace.
Top 5 spare parts to keep an eye on for February 2023.
This week marks the launch of the Cardano (ADA) overcollateralized stablecoin. In addition, the network upgrade for filecoin () is imminent, while the primary mainline network will be put into operation.
During this time, stream (flow) is set to halve its block rewards and the Internet computer (icp) will host a meetup to discuss the most intriguing decentralized finance projects (). These events are expected to bring attention to these altcoins, help prices turn volatile, and generate excitement in the crypto community.
Overall, the turnover of Pantera Capital to altcoins is a positive sign for the crypto market and reflects the company's confidence in the growth potential of this exciting and rapidly changing industry.
