Renowned Chinese cryptocurrency trader and analyst Garret Bullish argues that Bitcoin (BTC) and Ethereum (ETH) are not lagging other risk assets due to macro factors but rather because of internal market dynamics including deleveraging cycles, retail-dominated trading, and what he describes as deliberate price manipulation by exchanges and speculative funds.
What Happened: Analyst Blames Market Manipulation
Bullish, in a detailed market analysis published this week, contends that the October deleveraging-style decline wiped out significant speculative capital, leaving crypto participants nervous and hypersensitive to downside risk.
The analyst points to several structural issues holding back the two largest cryptocurrencies.
Retail capital has been absorbed by AI-related equities surging across China, Japan, Korea, and the United States, as well as a rally in precious metals.
Moving capital from traditional finance into crypto still faces regulatory, operational, and psychological barriers.
Bullish specifically criticizes certain market behaviors he characterizes as manipulation. "We frequently observe concentrated selloffs during periods of thin liquidity, particularly when Asian or US investors are asleep," he wrote, noting these moves trigger liquidations and forced selling among retail traders using 10-20x leverage.
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Why It Matters: Long-Term Outlook Remains Bullish
The analyst emphasizes that short-term underperformance represents mean reversion within a longer historical cycle rather than fundamental weakness.
Over a six-year horizon since Mar. 12, 2020, both BTC and ETH have outperformed most assets, with ETH being the strongest performer.
Bullish compares the current crypto market to China's A-share deleveraging environment in 2015, which preceded a multi-year bull market driven by low valuations and looser monetary conditions.
He argues that improving macro conditions, including regulatory clarity through initiatives like the Clarity Act, active SEC and CFTC promotion of on-chain equities trading, and easing monetary policy through rate cuts and the end of quantitative tightening, support eventual recovery. Without meaningful new capital inflows or the return of fear-of-missing-out sentiment, Bullish concludes, existing capital alone cannot counteract current market manipulation.