Crypto Assets market pullback in June, experts say the fundamentals of the assets remain unchanged.

In June 2024, the Crypto Assets market experienced a pullback, primarily due to the selling pressure of Bitcoin triggering a general decline in investor risk appetite. Nevertheless, some industry experts remain optimistic about this asset class.

In June, traditional assets exhibited mixed performance as the market digested various new risks. As a result, certain sectors performed poorly, including US home builders, the Chinese stock market, and some industrial metals. In contrast, global bonds, emerging market stocks excluding China, and the S&P 500 index showed relatively stable performance. Bitcoin and Ethereum both fell by approximately 10%, making them among the poorer-performing sectors on a risk-adjusted basis.

![Grayscale Research Report: Bitcoin and Crypto Market Under Pressure in June, but Asset Fundamentals Remain Unchanged](https://img-cdn.gateio.im/webp-social/moments-3908caf9b438f68bb5278c4947448802.webp01

The actual and expected selling pressure from multiple sources has contributed to the decline of Bitcoin this month, which in turn has affected other Crypto Assets. The main new selling pressure sources include:

1. Mt Gox Legacy: The bankruptcy estate's trustee announced that they would start repaying Bitcoin and Bitcoin Cash from early July, holding Bitcoin worth approximately $8.9 billion.

2. German Government: A government agency has started liquidating the Bitcoin seized in 2013, sending nearly 4,000 Bitcoin to exchanges during June.

3. U.S. Government: Sent 3,940 bitcoins to a deposit account of a certain exchange platform, which were seized from the wallet of a convicted drug dealer.

4. US Spot Bitcoin ETP: Experienced a net outflow of $581 million in the second half of June.

5. Bitcoin miners: continue to reduce holdings, having sold approximately 1,560 bitcoins in the past 30 days.

On the other hand, it was reported that a certain listed company purchased nearly 12,000 bitcoins in mid-June, which may have supported the price of bitcoin to some extent.

Although short-term capital flows have affected the price of Bitcoin, experts believe that the fundamentals of the asset have not changed significantly. For example, the market has priced in the possibility of further interest rate cuts by the Federal Reserve in the next two years to address easing inflation. In addition, certain adoption metrics for smart contract platforms show sustained growth, with daily active users on major smart contract platforms increasing steadily in recent months.

There has also been further progress in the listing of spot Ethereum ETPs in the US market. In late May, regulators approved the applications of several issuers to list these products on US exchanges. Experts expect that these products may begin trading in the third quarter of 2024 and could bring significant net inflows, supporting the valuation of Ethereum and tokens within its ecosystem.

Despite the decline of Bitcoin and Ethereum last month, their performance still outperformed the broader crypto market. The worst performers in June were consumer and culture-related crypto assets, primarily due to the weakness of entertainment-related tokens. In contrast, currency-related crypto assets, including Bitcoin, and financial crypto assets performed relatively well.

![Grayscale Report: Bitcoin and Crypto Assets Market Under Pressure in June, but Asset Fundamentals Remain Unchanged])https://img-cdn.gateio.im/webp-social/moments-282a4e88857391f59717ee2ddef07ac0.webp(

It is worth noting that Toncoin (TON) performed exceptionally well in June. As an important asset in the smart contract platform Crypto Assets sector, the TON blockchain is integrated into the Telegram messaging application, boasting a large user base and application development potential. Its daily active user count grew from an average of 27,000 in January to over 400,000 in June.

Despite the setbacks in the market in June, some experts remain optimistic about the valuation prospects for the remainder of the year. They believe that the macro backdrop is generally favorable for Crypto Assets, with economic growth, potential Federal Reserve rate cuts, and a strong stock market being supportive factors. Additionally, the approval of Ethereum ETPs may raise awareness among more investors about the potential of public blockchain in transforming digital business.

![Grayscale Research Report: Bitcoin and Crypto Assets Market Under Pressure in June, but Asset Fundamentals Remain Unchanged])https://img-cdn.gateio.im/webp-social/moments-1036c9ee4989f02d7386d652325e172a.webp(