Despite Bitcoin’s failure to hold above $80,000 after a recent rally, the cryptocurrency is unlikely to revisit the low price levels for most of this year, according to CoinMarketCap head of research Alice Liu.
“I think we may have already hit the bottom,” Liu told Cointelegraph on Trade Secrets, noting that bitcoin fell to around $59,000 in June this year, down about 53% from an all-time high of $126,100 in October.
Bitcoin recently touched $81,600 in early September, a roughly 28% increase since mid-August. It’s CoinMarketCap Crypto Fear & Greed Index, which measures overall sentiment in the crypto market, turned to greed after posting fear scores for most of the year.
However, Liu said there are more interesting narratives unfolding outside of bitcoin, particularly in the market for tokenized real-world assets and perpetual futures. “For hype (HyperLiquid), I want to mention two things. Number one is activity, and number two is price, because network activity doesn’t necessarily translate to price, and vice versa,” he says.
Alice Liu says HyperLiquid ‘still leads’
“One interesting thing is that I’ve been looking at RWA perps for the last two months, so criminals have backed into tokenized stocks, tokenized ETFs and tokenized indices,” he says. Liu said that while HyperLiquid currently holds market share, this may not always be the case as centralized exchanges are souped up.
“Tokenization of perps, people usually trade on HyperLiquid. But since Binance started introducing RWA perps, volume and liquidity quickly moved to Binance,” Liu said.
“Binance takes about 50% of the market share. But when it comes to DEXs, Hyperliquid is still ahead in that space,” he says.
Hyperliquid has moved 47.50% over the past 30 days. Source: CoinMarketCap
“Hyperliquid is still a space where a lot of liquidity is coming together and there’s a lot of product scale being built.”
In hyperliquid token prices, Liu points to a different driver. “The hype recently reached an all-time high: $86. And what’s really interesting is the buyback.” He explained that HyperLiquid is leading the pack in token buybacks, when a project uses its revenue to buy its own tokens on the open market.
“The hype has driven over $400 million in token buybacks. So I think some of the price action momentum that we’re seeing is also supported by that,” Liu said.
He says that there is only a small amount of tokens unlocked on HyperLiquid, so we will continue to see token unlocks roll out gradually.
Alice Liu is more cautious in describing AI-crypto
Liu says this means the hype price is dependent on the revenue flowing in to support the buyback.
“So, will there be enough activity in our network to generate revenue to continue the buybacks to support the price level? I think that’s one of the important things to look at.”
While Liu remains bullish on HyperLiquid, he is more wary of the AI-crypto narrative, particularly AI tokens with little or no utility that have surged in popularity by the end of 2023.
“They’re facing so much competition right now with the actual AI stocks, all the memory stocks and all the AI companies. So I think they can be a contender,” Liu said.
“Previous cycles are for mem-fide AI tokens that have no utility or infrastructure, and are entirely based on just one concept. I think they can probably go to zero,” he says.
However, Liu emphasized that there are “some really difficult” AI infrastructure projects. “I think they will have utility as well. But even then, I think they can get a price discount,” he says.
Liu says bitcoin and the broader crypto market are undervalued as a place to fund in the current economic environment, but he takes a more conservative view than Coinbase CEO Brian Armstrong and ARK Invest CEO Kathy Wood, who both predict bitcoin will reach $1 million by 2030.
“Bitcoin will be $500K by 2030,” laughed Liu
“It’s not unlikely that we could hit a million, but I would give it a more conservative answer,” Liu added.
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