CK Cheng, the former head of risk management at Switzerland-based bank Credit Suisse, said he expects the next bull market to begin in the first months of 2023, depending on the clarity of regulations in the US.
In an interview with Cointelegraph, CK Cheng said that some ongoing regulatory work in the United States will soon result in traditional finance “opening its doors to crypto.”
CK Cheng, a former executive at investment bank Credit Suisse, left his job in July 2021 to set up crypto venture fund ZX Squared Capital, which targets family offices and high-net-worth retail clients.
Cheng said that the attitudes of traditional institutions towards crypto have changed drastically recently, with many diving into the crypto space for the first time.
BlackRock, one of the world’s largest asset managers, announced in August that it will partner with Coinbase to begin offering institutional clients access to Bitcoin (BTC) and crypto through Coinbase Prime.
Recently, many prominent names in finance came together to create a digital asset exchange that serves institutional and retail investors and is backed by financial giants such as Charles Schwab, Citadel Securities and Fidelity Digital Assets.
Venture fund manager CK Cheng also said, “You see more and more traditional finance companies getting involved in the crypto space these days. […] We can see tremendous interest,” he said.
However, Cheng added that there are many companies in the US that are waiting for regulations to be made clearer:
“Clarifying regulations will truly open the door for traditional finance companies to crypto, bringing in even more organizations and investors into this space. So I can say that the next bull market will start like this.”
CK Cheng believes that the Presidential Decree signed by US president Joe Biden in early 2022 is a big signal for traditional investors. But he also acknowledges that “the devil is in the details” about how crypto trading is regulated and whether cryptocurrencies are considered commodities or securities.
“As long as the regulations are clear from an institutional perspective, it gives institutional investors a pretty clear path to avoid legal problems,” Cheng said. […] This will bring more institutional investors to this field,” he said.
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When CK Cheng, the former head of risk management at Credit Suisse, was asked about when the breaking point will occur, Cheng said he expects legal clarity to begin to appear early next year.
“Hopefully we’ll see something much more concrete early next year. And that’s what people think. [kripto] It will help the market in terms of perception and sensitivity. I think the regulation will help in this regard.”
Asked how the Bitcoin (BTC) price will be affected in the short term, Cheng said that he expects October to be a “highly volatile” month for BTC.
However, CK Cheng said, “October will be a highly volatile period with a lot of discussion in terms of the Fed and policy change, especially when coupled with high inflation. “The concern is that if the Fed continues to tighten its rate decisions, the US economy could plunge into a serious recession,” he said.
Finally, Cheng believes that this uncertainty will cause a lot of volatility in both the stock and crypto markets, but stability will be achieved in the coming year. At the same time, it is thought that “another bull market” could start before the next Bitcoin “halving” in 2024.