Despite a massive wave of selloffs in the cryptocurrency market, some companies that sold their cryptocurrencies in recent months are not Bitcoin (BTC) bears at all.
Canada-based investment firm Cypherpunk Holdings was one of the companies that opted to sell cryptocurrencies in the midst of the crypto winter of 2022, liquidating 100% of its Bitcoin and Ether (ETH) in June. cypherpunk, one of the world’s first public companies to invest in Bitcoin, said at the time that it maintained its long-term “bullish outlook on cryptocurrencies” despite selling all of its digital currencies.
The Cypherpunk cryptocurrency liquidation may seem a bit strange, as the company’s shares trade under the symbol HODL on the Toronto Stock Exchange. The acronym is widely used in the cryptocurrency community to refer to “Hold On for Dear Life”, or the bullish strategy of holding on to Bitcoin regardless of market circumstances.
According to Cypherpunk CEO Jeffrey Gao, cryptocurrency investors may remain bullish despite cashing in on their crypto from time to time.
“We are in this business because we are net bulls on cryptocurrencies in the long run”Gao said in an interview with Cointelegraph. Cypherpunk can get back into Bitcoin or “any cryptocurrency or any basket of cryptocurrencies” tomorrow if they wish, and those are “certainly opportunities” the firm is actively pursuing, the CEO noted.
Gao said the sector has seen forced liquidations, as even the “supposedly most sophisticated” institutions such as Voyager, Three Arrows Capital and Celsius got involved in deals that were “completely devoid of risk management”.. According to the CEO, the absence or near absence of risk management is what really separates the cryptocurrency industry from something more mature. Gao added:
“Going forward, that mindset towards managing risk while remaining bullish for the long term is very important. […] You can be bullish on cryptocurrencies, but you can also sell off the market.”
According to Gao, Cypherpunk began the liquidation process in early May, just before the Terra network collapse, with the algorithmic stablecoin TerraUSD (formerly UST) losing its peg to the US dollar on May 10. “At the time it happened, we probably offloaded about 30% or 40% of the risk”Gao said, adding that Cypherpunk then sold another slice when BTC briefly traded above $30,000 in late May. “The last third that we probably got rid of was sometime in June,” Gao said.
“We basically didn’t make progress, but we also avoided a lot of capital destruction,” Gao said. He went on to say that he is very bullish on altcoins like Ether and Solana (SOL), despite some issues with the Solana ecosystem in early August.
“In the long term, at least right now, I would be more bullish on Bitcoin than those other tokens. But in the next two or three months, I would probably be more of an Ethereum and Solana supporter,” the CEO noted.
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