Famous cryptocurrency analyst Alex Krüger, in his comprehensive statement evaluating the recent market movements, said that the decline was similar to the sharp pullback experienced in August of last year.
According to Krüger, this sharp market correction was shaped by a combination of macroeconomic developments and negative crypto-specific news flow.
Krüger recalled the August 2024 crash, explaining that the decline during that period began with a Bank of Japan interest rate hike and was fueled by a hawkish Fed and weak employment data, leading to panic. The analyst noted that a similar dynamic prevails in today's scenario, explaining that while there's no carry trade effect, a hawkish Fed, complex corporate balance sheets, strong personal consumption expenditure inflation, and sharp stock market profit sales are shaping the picture.
Krüger, who described political developments such as US President Trump's dismissal of the head of the Bureau of Statistics (BLS) and nuclear war rhetoric as “market noise,” stated that the real decline was accelerated by the liquidation of leveraged investors rather than such statements. He noted that Bitcoin formed a local bottom following a sharp sell-off.
Krüger also touched on developments in the crypto market this week. Coinbase's weak balance sheet, the possibility of MicroStrategy shutting down its share sales mechanism, and sustainability concerns regarding the “Digital Asset Treasury Company” model on the ETH side are among the factors increasing market pressure. However, according to the analyst, the SEC's “Project Crypto” initiative is a significant step toward bringing securities laws onto-chain and is quite positive for the market in the long term.
Krüger believes the market has either bottomed out with today's sharp sell-off, or that the bottom will form on Monday, along with stocks. “We're seeing a repeat of last year's August crash,” he said. “I'll be adding to my long positions before the US markets open on Monday,” he said, describing the decline as an aggressive “shake-up.”
According to Krüger, one of the critical turning points for markets is the Jackson Hole meeting and a potential interest rate cut in September. He argued that the departure of Fed Governor Kugler provides Trump with an early appointment opportunity, which could provide a dovish counterbalance to the hawkish Fed leader Powell.
Krüger is optimistic about the medium-term outlook for the crypto market. He argues that the market will continue its upward trend with interest rate cuts and increased crypto adoption starting in September. He also stated that a full-blown dovish Fed approach, particularly starting in May 2026, could propel Bitcoin into the $200,000-$250,000 range.
However, he adds a caveat: the loss of momentum from digital asset treasury companies and the inflationary pressures of US tariffs could lead to some market complications at the end of the year. However, he considers these to be secondary for now.
*This is not investment advice.
