I don’t follow it enough to know what is happening but yikes, those are some massive dips!
I was considering getting into NFTs (I like to make digital art so why not?) but if crypto is failing, this is sure to follow - right? Then again I don’t know enough about either to understand what is happening to the market.
Does anyone here know what is happening?
I think this is mainly down to the fact that a lot of people are facing financial troubles and are pulling out on investments. The economy in the US as well as other countries have been in a bad place since 2020 and things have only been made worse since a certain old sleepy man took control… smh
Also, the fed interest rates hiked which soured a lot of people on their investments.
speculative investment.
Subbing to find out.
A lot of people bought into it as a trend. Now those people are pulling out. All that will be left are the true backers and investors again, like pre-2020. I know someone who has 5 bitcoins. Even at their highest, he didn’t sell them. He only paid $50 a piece when he got them and he said he is in it for the long haul. He believes they will hit 100k in 2023.
The bulk of growth you have seen since 2020 was down to people betting, not investing. A lot of people heard of stories where people got rich overnight and wanted to try it themselves.
I project all crypto to continue on a downward trend until the balances out with Bitcoin being around 12k per coin.
Everything is tanking. Stocks, crypto, NFTs, etc.
I think this has more to do with the fact that inflation is getting worse and the economy in several countries is on a downward trend as a whole.
Most people I know who invest (friends, family, and co-workers) have said this is the main reason they pulled out. They feel like the government is going to get too involved and that defeats the purpose of it.
No way it drops this low. Crypto is already balancing itself out. I think it will take a lot longer to get above 40k for Bitcoin this time but it will not drop below 20k at this point.
Ok, Time for some speculation. Crypto currency relies heavily on energy indirectly through mining. Recently, electricity prices have been hiking dramatically (So much as a 55% increase from £1277 (2021) to £1979 (2022) by Ofgem in the UK and is probably similar in other countries too.
This means that it is less profitable to engage in said mining and for some, can even cause a loss and so is better to not mine. This means that crypto like Monero cannot remain secure and so creating transactions that could be malicious or fraudulent may be easier since some currencies rely on clients mining within a pool in order to help keep it secure. This is done through the proof of work algorithm (known as mining.) Hence it all wraps around and defaces the value.
Another scenario which is even more likely is that (this is believed to be true by some experts within economics) that there is a correlation with the value of cryptocurrency and the stock market. Possibly because if the stock market is doing badly, It could be a sign of an onset recession as people spend their financial income cautiously which also impacts non-essential businesses like “luxury” brands. Less trading activity due to less perceived value means that the market value decreases. Knowing that Crypto-currency work in a similar way in that you can invest money and also remove investments through exchanges, It is probably another reason for the correlation.
Take this answer with a grain of salt. I may be incorrect but I have done some research whilst answering the question.