Andrew Kang: “It’s too early to buy more cryptocurrencies”

Andrew Kang, co-founder of Mechanism Capital, argues that the current bearish trend in the cryptocurrency market often misleads investors. The correction caused by major structural changes may take longer and be more severe than expected. This could lead to significant losses for those rushing to buy crypto assets.

Kang points out that one of the most common mistakes in the cryptocurrency market is buying too early. In his opinion, investors should not buy cryptocurrency when the price decline only partially reflects a bearish trend. “The most common mistake in the cryptocurrency market is buying too early when the trend changes from top to bottom. It's best not to buy when only a few people are bearish and Bitcoin is only 10% off its high. In such scenarios, pressure from sellers is not enough to reduce prices,” Kang wrote on social media X.

Andrew Kang believes that it is more advisable to buy cryptocurrency during more serious downturns. He notes that the best time to buy is when the market has completely rid itself of weak participants who doubt the viability of cryptocurrencies. When market sentiment drops and most traders believe that the cryptocurrency is gone forever, then the market is in an oversold state and prices have reached rock bottom levels. At this point, investors can expect a more favorable risk-reward ratio.

The founder of Mechanism Capital also noted that more than 98% of altcoins have reached the peak of their cycle. According to his forecast, only a small portion of altcoins will reach new highs in the fourth quarter of 2024 or the first quarter of 2025. This means investors should be cautious and not count on rapid growth in most alternative cryptocurrencies.

Kang recently suggested that with the introduction of spot exchange-traded funds (ETFs) for ether in the US, ETH could fall to $2,400. He believes that institutional investors are less interested in this cryptocurrency than in Bitcoin, which could lead to a further decline in the price.

Andrew Kang warns investors to be cautious in the cryptocurrency market amid a bearish trend. He recommends waiting for more serious downturns to buy cryptocurrencies, when the market is cleared of weak participants and prices reach minimum levels. At the same time, he advises not to count on the rapid growth of most altcoins, since only a small part of them can reach new highs in the coming years.