Crypto prices could be volatile over the weekend and taking off some risk or buying some protection might not hurt

As our clients know, we are long term bullish on crypto. As recent as this Wednesday, we held our Mid-Year 2021 Crypto Outlook call and discussed macro factors that lean towards medium term bullishness as well.

But, over the coming weekend, we might be inclined to take some risk off the table or buy some protection.

We think it’s possible that the selling we’ve seen over the last day or so is related to concerns over leverage and counterparty risk of some lenders. 

Below is a Tweet made yesterday by Barry Silbert, the founder and CEO of Digital Currency Group:

The video in this report is only accessible to members

Source: https://twitter.com/barrysilbert/status/1408191462324441092?s=21

We’ve since seen a large short position start building again on the crypto exchange Bitfinex. The last time a short of this level started building, we had negative news out of China that took us lower.

The video in this report is only accessible to members

Source: Tradingview

Reports have surfaced in crypto media outlets about the crypto lender Celsius losing its custodian provider due to “endlessly re-hypothecating asset”.

The video in this report is only accessible to members

Source: https://www.coindesk.com/custodian-prime-trust-cuts-ties-with-crypto-lender-celsius

According to a March 2021 press release by the company, the lender at the time had ~$10B in digital assets.

The video in this report is only accessible to members
Source: https://www.prnew...

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