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In response to the drastic market movement brought about by the Terra Luna depegging that took place over the last few days, the Head of Investment Insights and Chief Investment Officer of IDEG, a leading digital assets management firm, and senior partners of Fundamental Labs, a leading Web3 venture capital firm, commented:
- Markus Thielen, Chief Investment Officer of IDEG emphasized that the market consolidation could indeed bring in more opportunities: “As a direct result of the Terra Luna / UST de-pegging, we will likely see a cyclical period of ‘contained contagion’ across the industry. Projects and their investors scramble and assess the underlying collateral of remaining stablecoins, patching and reallocating assets to mitigate risks of financial vector attacks. Yet such dislocations bring opportunity. After witnessing cyclical breakneck growth, the market will take a short-term breather. Long-term investors can (and will) pick up cheap bargains, and build positions of both talent, assets, and technology.”
- Kevin Loo, Head of Investment Insights of IDEG stated that: “Geopolitical uncertainty and demand for diversification of both assets, and centralised counterparties, will also strengthen the case for the crypto over a secular horizon. From a strategic perspective, short-term price dislocations allow for asset accumulators to step in. Global regulators, already having stablecoins in view, will actively push hard to pursue action upon the stablecoin market.”
- Henry Love, Managing Partner and the Head of US operation for Fundamental Labs articulated that: “Given the huge uncertainty within macro environment the crypto market is currently in tumult. However, dislocations bring additional opportunities for those actively involved in the market. A direct consequence of recent events will force digital asset projects with weak fundamentals or tokenomic bugs to re-audit, patch and fix their processes to avoid becoming the next victim, such as Terra LUNA. Traders, seeking to generate performance, will probe public chain business models. We actively remind our portfolio companies to review their tokenomic models and learn from this experience.”
- Howard Yuan, Co-Founder, Managing Partner of Fundamental Labs noted that: “We all knew this was going to come due to experimentation. Just a matter of when. Now the breaking will strengthen the ecosystem in the long term - short term people will panic.”
Please refer to the attached market update to check out more about the market outlook and opportunities amid the turmoil.
