Tushar Jain, co-founder of crypto asset investment firm Multicoin Capital, said that optimism across the cryptocurrency market has become excessive and that a correction or an extended stretch of sideways consolidation could unfold over the coming period.

In his assessment, Jain said market sentiment has reached a “slightly euphoric” level, emphasizing that a short-term pullback would not come as a surprise to him. At the same time, he argued that it is not a sound strategy for investors to try to predict every short-term peak and trough. His remarks amount to a qualitative sentiment check from a prominent crypto fund manager — the kind of read-out market participants often weigh alongside hard demand data when judging how stretched positioning has become.

According to the Multicoin Capital executive, investors need to shift their perspective toward the longer term and avoid overtrading. Rather than attempting to time every short-term market movement, he said a more viable approach is to hold high-quality assets with strong investment theses and wait for those theses to materialize over time.

Separately, indicators tracking Bitcoin demand in the US market also point to short-term weakening. According to Coinglass data, the Coinbase Bitcoin Premium Index has returned to negative territory, falling to -0.0198 percent after standing at 0.0013 percent the previous day.

The index measures the difference between Bitcoin's price on Coinbase and other major global exchanges. Because Coinbase is one of the principal US venues for dollar-denominated Bitcoin trading, the gauge is widely followed as a proxy for American spot demand, and shifts between positive and negative territory are read as changes in that demand. Its turn back into negative territory suggests a renewed weakening in buying appetite among US-based investors.

This is not investment advice.

Source: Bitcoinist