‘Liquidity’ has most affected Bitcoin’s price over the past year, according to trader Brian Krogsgard

Cointelegraph’s Crypto trading secrets podcast has published Episode 6, which covers a variety of content that should pique the interest of cryptocurrency traders. This episode’s guest is Brian Krogsgard, also known as Ledgerstatus on Twitter. Krogsgard is a trader and one of the co-founders of Flip.xyz, an NFT (nonfungible token) platform. He is also a podcaster in the crypto space.

Among the questions asked during the February 16 recording, host Benjamin Pirus asked Krogsgard to give his opinion on what he thinks has most affected the price of Bitcoin (BTC) over the past year. “Liquidity,” he replied.

“People just don’t have free liquidity for any number of reasons. They have counterparties that went bankrupt, which may have forced them to lose money. They got coins stuck in places that went bankrupt. Lost access to them, lost trading, lost because of taxes, anyway.”

“These are all challenges for liquidity, and you need liquidity for the healthiest markets, and so that’s been a challenge,” he added. Amidst the runaway train that was the crypto bear market of 2022, the space experienced significant turmoil. Several cryptocurrency companies failed, including the likes of crypto exchange giant FTX.

“I would actually say that the problems predate that with Bitcoin because we saw with FTX that there was massive rehypothecation of Bitcoin,” Krogsgard continued. “Rehypothecation” is when entities use customers’ collateral for other activities, according to Investopedia. The collapse of FTX in November 2022 sparked a number of headlines, such as allegations of misappropriation of customer funds by FTX and sister entity Alameda Research.

“So the Bitcoin people thought they had on FTX wasn’t there, and FTX sold it to do other things. And that rehypothecation was actually a drag on Bitcoin’s price even in a bull market. And now that we have liquidity problems, it’s just been a consistent form of price pressure and given challenges for a year and a bit more.”

Krogsgard gave his thoughts and opinions on several other points during the episode and also talked about his background.

Check out this and other episodes from Cointelegraph’s Crypto trading secrets podcast on Cointelegraph’s podcast page, Apple Podcasts, Spotify, Google Podcasts or TuneIn.

The views, thoughts and opinions expressed herein are those of the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.