Froth and Regulatory Landmines Could Crush Altcoin Markets, Warns Macro Guru Lyn Alden

Froth and Regulatory Landmines Could Crush Altcoin Markets, Warns Macro Guru Lyn Alden

Time Stamp: April 24, 2023 7:45 AM

Macro Guru Lyn Alden is issuing a warning to investors, saying that potential regulatory enforcement actions could drag down the altcoin markets.

In a new interview on the Hedgeye podcast, Alden says that regulatory landmines coupled with excessive leverage could crush altcoins.

However, Alden notes that Bitcoin (BTC) could be unaffected.

“So I separate Bitcoin from the rest of the crypto space, I think the broader crypto space, the noise-to-signal ratio [is] unfortunately very high. I still think there’s a lot of froth that has to bleed out. I think we’re obviously seeing more and more regulatory hits against that space.

Basically, they define what is the security, which assets have violated security laws [and] which companies have violated security laws by selling those assets to the public. I think that that whole space is kind of fraught with landmines. Going forward, I’d be very cautious around putting serious capital in that space.”

According to Alden, the king crypto will be immune to most regulatory enforcement because it resembles a commodity more than a security.

“Bitcoin, I put in a different category because it’s not a security, it’s recognized as a digital commodity because it doesn’t pass the Howey test. I also think the fundamentals that the actual decentralization [are] more robust, and I do think that a lot of the froth has already been worked out of the Bitcoin space.

A lot of the tourists have gone during this whole catastrophic bear market.” 

Bitcoin is trading for $27,770 at time of writing, a fractional increase during the last 24 hours.

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