Crypto billionaire’s trading firm buys the dip as Bitcoin briefly falls below $30K
Quantitative trader Sam Trabucco explained that the firm’s strategy to go long BTC/USD is a result of three catalysts that could fuel BTC’s recovery.
Wed, 21 Jul 2021, 16:01 pm UTC
The old adage that timing is everything is true even in crypto trading. For the trading firm of the world’s richest cryptocurrency billionaire, the perfect time to buy more Bitcoin came on Tuesday as BTC fell below $30,000.
Alameda Research has turned Bitcoin’s recent decline into a “buy the dip” opportunity, according to Cointelegraph. Alameda is a Hong Kong-based quantitative trading firm that was founded in 2017 and headed by crypto billionaire Sam Bankman-Fried.
Alameda’s purchase of Bitcoin during the latest dip was revealed by quantitative trader Sam Trabucco. He explained that the firm’s strategy to go long BTC/USD is a result of three catalysts that could fuel BTC’s recovery. These include the potential end to the crypto FUD caused by a number of factors including China’s ban, the derivatives market’s weaker long liquidations, and the intraday recovery of the stock market.
“And all these led to Alameda doing what we do best -- buying a LOT more over the past day or so,” he said. “This isn't quite ‘sell us all you want below $30k and fuck off’ territory, but we're continuing to buy down here, because it really just seems like too much points that way.”
On Wednesday, Bitcoin has already slightly recovered from its dip below $30,000. At the time of writing, the crypto traded at $31,853.01 based on Coinmarketcap data.
Some have been expecting that a close below $30,000 could result in the crypto’s price drastically moving lower. However, AvaTrade Ltd chief market analyst Naeem Aslam pointed out that BTC has shown resilience in the face of recent bearish outlooks.
“In reality, that is not what we have seen,” he said. “The Bitcoin price has been stable, and we have not seen any panic selling.”
But Alameda is not focused on short-term price movements. Trabucco explained that its recent BTC purchase is focused more on the crypto’s long-term potential. “We do put on fairly big delta positions longish-term for a quant team, and I’ve been glad that it’s been this direction so frequently — bull markets are way more fun,” he said.
This long-term view is shared by Grayscale CEO Michael Sonnenshein. “Investors in this asset class are really not focused on... short-term movements in price,” he said in this week in an interview. “These are really investors looking at their allocations in the medium to long term, and so any volatility or dampening of volatility is not something anyone is fazed by.”
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