Despite the massive volume of liquidations in the cryptocurrency market, some companies who sold their crypto over recent months are not bearish Bitcoin ( BTC).
Cypherpunk Holdings, a Canadian investment company, was one of those that decided to sell crypto during the crypto winter 2022. It sold 100% of its Bitcoin and Ether ( ETH) by June. Cypherpunk, one of the first companies to invest in Bitcoin in public, stated at that time that it still held a long-term bullish view on crypto despite having sold all its digital coins.
Cypherpunk’s crypto liquidation may seem strange, as the stock trades under the ticker symbol HODL at the Canadian Securities Exchange. The acronym is widely used in crypto communities to signify “Hold on for dear Life”, or the bullish strategy to hold onto Bitcoin regardless of market conditions.
Jeffrey Gao, CEO of Cypherpunk, says that crypto investors can remain bullish even if they cash out some crypto.
Gao stated that they are in the business of crypto because they are net bullish for it over the long-term. The CEO said that Cypherpunks can go back to Bitcoin or “any crypto or any other basket of crypto” tomorrow if necessary and that these are “certainly opportunities” the company is actively seeking.
Gao stated that forced liquidations have been a common occurrence in the crypto industry. This is because even the most sophisticated institutions, such as Voyager, Three Arrows Capital, and Celsius, got involved with operations that were “completely lacking in risk management.” He said that this is what separates the crypto market from other mature industries. Gao added:
“It is important to have a positive outlook and a mentality that values risk management, while remaining bullish for the long-term. […] While you can be bullish about crypto, it is possible to still sell out.
Gao claims that Cypherpunk began the liquidation process in May right before Terra (LUNA), now renamed Terra Classic, (LUNC), network collapse. On May 10, the algorithmic stablecoin TerraUSD (formerly UST, ) lost its U.S. dollar peg. Gao stated that Cypherpunk had probably offloaded around 30% to 40% of the risk by the time it occurred. He also said that Cypherpunk sold another portion after BTC briefly traded above $30,000 in May. Gao stated that the final third of the risk was likely to have been disposed off in June.
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Gao stated that although we made little progress, we avoided much capital destruction. He said that he was optimistic about altcoins such as Ether ( SOL), even though there were some problems with the Solana ecosystem in early August.
“Over the long term, at least at present, I would be more conservative with Bitcoin than other tokens. However, I will be more partial to Ethereum and Solana over the next two-three months,” the CEO stated.