Nov 2022#MarketResearch#FTX

Survey results of the crypto market’s top managers amid the FTX collapse:the expectation of further decline and investment increase plans

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Authors

Marat Gizatullin

Marat Gizatullin

Analyst, R&D

Svetlana Kopach

Svetlana Kopach

Consultant, Strategy

Ales Kovalevich

Ales Kovalevich

Managing Partner, CEO

Tatiana Savvova

Tatiana Savvova

Manager, P&A

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4 min

The FTX event shocked the market: -a 25% decline in the value of BTC, Ethereum dropped to sub $1000, and the total market capitalization fell below $1 trillion. What do the founders and leaders of crypto projects think about this? This article presents the survey results of 53 C-level managers of top crypto projects from different subsectors (crypto payments, DeFi, GameFi, SocialFi, Metaverse projects, etc.).

Market dynamics expectations

According to some estimates, the current bear market began in early 2022. In a recent publication, Grayscale analysts outlined the end of the decline to be the period from November to December 2022. However, the events related to the investigation into the activities of FTX Trading Ltd (from November 7 to November 11) impacted the new decline of BTC value from $20.592 to $15.708. Currently, the price is stabilizing at $16.000- $17.000.

The price of BTC is one of the key indicators of the crypto market’s current state. In this regard, it is crucial to understand investors’ expectations regarding the asset’s future price.

The interviewed crypto projects’ executives and founders expect a further BTC decline. The average expected price is $11.479, which is 31% lower than the current BTC value (16.678 as of November 14, 2022). The highest predicted price is $17.000 (1 respondent), and the lowest is 0 (3 respondents).

Stablecoins

Coins such as USDT/USDC/BUSD are among the most important assets and settlement tools between crypto market participants. In terms of capitalization, they are in the top 10 coins in the entire crypto market. The key feature is the declared peg to the US dollar, achieved through a special asset collateral structure. Consequently, decoupling from the equilibrium price of any of the major stablecoins will have fatal consequences for the market.

91% of survey participants believe stablecoins will not lose their peg to the dollar amid current events.

It is important to note that the average expected price of BTC is almost identical among both those who answered: “Yes” ($11.560) and those who answered, “No” ($11.471). That is, the expectation that stablecoins will remain pegged to the dollar does not determine how positively respondents view future market changes.

Personal investment tactics

Expectations about the market allow one to understand the mood of investors, but investment tactics offer a clearer picture. The survey showed that more than half of the top managers plan to increase their crypto assets, and no one plans to reduce them.

As described earlier, the crypto market is now characterized as “bearish.” However, ⅔ (66%) of the top project managers surveyed are expected to expand their crypto portfolio over the next month, ⅓ of the respondents will not take any active actions. At the same time, not a single respondent chose the option “No, I plan to reduce my current crypto portfolio” among the possible answers.

Expectations of the average price correlate with the expected strategies — among those who answered about portfolio expansion, the estimate of the future “stable value” (the price at which BTC will complete its fall) is $12.361 versus $9.764 among those who refrained from active investment actions and exit from investments.

Promising market directions

As part of the survey, respondents were also asked to identify the area of the crypto market that is the safest in the current market and has the maximum growth potential.

The top 5 responses include DeFi, Infrastructure Solutions, GameFi, BTC, and DEX – according to respondents, these areas are the best protected from falling. In addition, these areas have the highest growth potential.

The designated areas are among the largest projects on the market in terms of captalization (according to Coinmarketcap, Coingecko and Cryptorank). Comparing the market data and the categories indicated by the respondents, one should pay attention to infrastructure projects - they are one of the largest in terms of capitalization, and their 30-day decline is the smallest in the above areas.


Despite the general panic, the survey results allow us to conclude that investors are optimistic: the current recession is not over yet. However, it opens up investment opportunities that respondents intend to take advantage of by expanding their positions in the crypto market.

 

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