Thread by @mrjasonchoi

1/ It's 2019 - is the pain in crypto over?

Let's take a look at a metric partly inspired by @BMBernstein @fundstrat (% of select top 200 market cap assets declining >70% over trailing 90 days). As usual, not financial advice and not reflective of company's views.

2/ In 2018, total market cap of crypto declined more than 80%. Comparing S&P 500 to crypto is comparing apples to rotten oranges, but for the sake of reference: the worst performing decile of S&P500 large caps declined by 43% and mid caps by 50% in the same period.

3/ While there was consistent selling pressure throughout 2018, most of the significant market dips were caused by sudden and extreme spikes in sell offs, where up to roughly 70% of cryptoassets in the top 200 market cap lost most (>=70%) of their value within 90 days.

4/ These sell offs are cyclical, and spikes happen as fast as they disappear. Just as FOMO buys lead to the symmetrical spikes in % of coins gaining 200% in value (as @BMBernstein noted), panic sells lead to sudden spikes in coins shedding most of their value.

5/ Looking at these spikes gives us an opportunity to look at how differently the market views "blue chip" assets like BTC and ETH in a sell off scenario where fear is the prevailing sentiment.

6/ Leading into every sell cycle, BTC dominance gains and ETH falls. In the second cycle where more than 50% of alts shed most of their value (again), BTC dominance grows throughout the entire cycle as ETH continues to lose dominance.

7/ Comparing price during sell cycles for BTC and ETH gives us a better view. While the entire market rebounded post the 1st cycle, in the 2nd cycle, BTC price held up better than ETH. This signals that the market is viewing BTC as a better store of value during sell offs.

8/ Overall, sell spikes are subsiding in scale over 2018. While this seems obvious, remember that there's no theoretic limit to how many times alt coins can lose 70% of their value (besides the smallest unit that exchanges support), especially given current price levels.

9/ There's too few data pts to call any of the above confirmed "trends", but what we know is this: sell offs happen in sentiment-driven cycles, each sell off is not as bad as the last, and that out of the 2 most accessible altcoin onramps, BTC outperformed ETH as a store of value

10/ Above analysis is heavily anchored on one metric and simplistic, but hopefully serves as the starting point of more in-depth discussions. Welcome any and all feedback!

cc @nlw @KyleSamani @cburniske @Travis_Kling @QWQiao /end