The founder and CEO of Binance, Changpeng Zhao (CZ) recently spoke at the Binance Blockchain Week in Singapore, where he proclaimed that the cryptocurrency market is severely undervalued, as many cryptos are oversold.
2017’s Unprecedented Crypto Rally
Speaking to the crowd, CZ admitted that the prices of cryptocurrencies experienced a meteoric rise, leading to overbought conditions in 2017. He further explained that the dramatic rise in price brought in many new people and sub-par cryptocurrency projects, and once everyone had already gotten in, the price declined.
“I believe… at the end of 2017, there was definitely an overshoot on the price side… There was a lot of guys rushing in, very simple projects with very simple whitepapers. […] Then of course as everybody rushed in…once that massive rush-in finishes the price declines.”
To reflect on 2017, the cryptocurrency market cap reached an all-time high of over $800 billion, while Bitcoin’s price reached $20,000 on many exchanges. Thousands of crypto projects were created and money was flooding in from everywhere.
There’s no doubt the crypto industry was overhyped with multitudes of crypto projects in it just for the money. Many projects were outright scams, while others just had weak fundamentals and focus. When people started realizing this, the market took a turn for the worse.
2018’s Unprecedented Crypto Bear Market
While 2017 and the beginning of 2018 saw hyperbolic rises in price, for most of 2018 the cryptocurrency market has seen one of the most brutal bear markets of all time. Even as we kick off 2019, the bear market is stronger than ever and showing no signs of slowing down.
However, just as 2017 saw an unreasonable shoot to the upside, Zhao believes we’re now overshooting to the downside.
“We’ve been in a bear market for a very long stretch, probably the longest in history for Bitcoin right now […] I think right now my personal view is that we are actually overshooting on the lower side now”
The CEO then explained why he thinks this, stating that while crypto prices are dropping, the industry is growing at a rapid pace. CZ states that there are more people in the industry, more people working in it, more crypto conferences, and more people attending them.
He also emphasized that not only are there more people involved in this industry, but there is a lot more development and building happening as well.
“The builders are building, we are seeing a lot more development in the space, so I actually think that we’re probably overshooting on the lower side, but again I could be wrong, this is mass technology.”
Binance CEO CZ is Not Concerned With Price
Apart from discussing the current market conditions as being overshot to the downside, CZ proclaimed that he doesn’t look at the price. He stated that he can go weeks without looking at the price because his company, Binance, is focused on building so that they’re prepared for the next upside cycle.
“I’m very, very confident that this space will get so much bigger, we just got to be prepared for when that happens.”
Do you think the cryptocurrency market has shot too far to the downside? Is the overall crypto market currently undervalued? Let us know what you think in the comment section below.