Prices keep going down and down and down and down...
With the recent prices of once giant cryptocurrencies dropping more than 50%, it leaves us wondering what we were thinking in the first place. Whether you invested in bitcoin or bitconnect, you have definitely have not seen an increase in price.
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Scroll down below to figure out how this is possible!
Some reasons for the FUD:
1. Governments do not support crypto - with an increase in regulations coming in early 2018, countries like Korea, and India have added to the cryptocurrency FUD. In fact everything first started tanking in results to the South Korean ban. Which since then, they have come out and even though they don't like crypto, they will support it. Leaving for a lack of countries that support crypto (Canada is one even though they don't have much volume. If you think about it, even though it hurts us, it makes sense why giants of capitalism would not want to give up their position in the world of money.
2. The Dow Jones has been tanking - Even though crypto is supposed to be seperate and decentralized from the world of finance. The recent dips in the Dow Jones (as of today, the last two weeks have dropped the price by over 2000 points) have brought a lot of skepticism to the overall market. It has also given way for people who no longer believe in crypto, to sell their crypto and buy stocks in the Dow Jones for much cheaper.
3. Investing psychology - Think about it, when one person sees red in the cryptocurrency market, their first reaction is to sell. Which gives off a ton of panic selling. All made up of people who got into the market late (completely losing their money), and people that are looking for easy profits. Even if those easy profits could lead to much more in the future. These people are the ones that don't get the crypto message of HODL, and are the ones that make the market tank. However, this kind of psychology can be easily avoided by people doing their own research, and still realizing the potential of their coins.
4. Crypto Whales are influencing us all - Due to the reason that crypto is still relatively small, the influence that somebody with a big bank account has over the market is outlandish. They can either influence people to buy their coin, or sell and take their profits while everybody else loses. This being very difficult on the overall market, can and needs to be avoided by more people taking positions in cryptocurrency.
5. Insider trading - This has been shown in many cases, through many currencies of people getting information by their own currency or other people from currencies. This has a tendency to put and huge panic in the market. As insider trading is illegal, it is a horrible and unlawful way of making money.
Is the market at the bottom now?
Well this is extremely hard to tell, many people have been comparing these crashes to the pop of the dotcom bubble. When it popped, many people lost a ton of money and prices went down extremely far. However, in the grand scheme of things, the markets have overall recovered from that. So as cryptocurrency is at the same level of a movement as dotcom companies, it too will return to its formal value. One thing is, that many currencies will not be the same, and most may not last through this all. This crash could end tomorrow, or it could end in weeks, years, or months. At this point in time the market is just unstable, and hard to tell. This is why it's our job the HODLers of crypto, to keep this movement alive. Stay strong crypto community!
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Unlike veterans in this space that remember 90%+ falls, the late comers must be panicking now. This presents a great opportunity for first time buyers.
Agreed!