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Bitcoin and Ethereum have brought down the entire crypto market along with them
The cryptocurrency market has taken the entire investment space by storm after generating abnormal amounts of returns over the past few years. But currently, crypto fanatics are slowly drawing away their hopes of market recovery as cryptocurrencies fell once again with Bitcoin lowering as low as US$25,000 and Ethereum sliding down below US$1,200. The great fall of the cryptos has spooked even expert investors who are left speculating if they can still acquire multifold returns in the coming days. Experts are currently suggesting investors tread the market quite carefully. They have to be disciplined enough to trade based on their capacities and not recklessly follow the trend. After the major wins for the crypto market in 2021, investors looked forward to diversifying their portfolios. But when the crypto market fell in 2021, experts were quite sure that the market would continue to fall and so it did. Currently, with the recent decline in BTC and ETH prices, all other crypto assets have witnessed almost US$1 billion in liquidations. Both Bitcoin and Ethereum are struggling to regain back their lost market values, and only time will say if and how investors will manage to retain their investments in the market.
Investors are soon losing hope as crypto-tracked futures have lost over US$1 billion within a period of 24 hours. As cryptos continue to lose liquidation, investors aggressively sell off their investments. Now for those investors who are new to the market, liquidation generally indicates when an exchange forcefully closes an investor’s transacting position because of a partial or total loss of the investors’ initial margin. This phenomenon generally takes place when a trader has insufficient funds to keep the trade open. So, before Bitcoin fell to US$25,000, the crypto had found its support level around US$29,000 and Ethereum found its support near US$1,800. As these top cryptocurrencies fell, it brought down other major altcoins with it.
Why is the crypto market still plummeting?
It is quite a common fact that the cryptocurrency market has crashed to an all-new level this year. The global crypto market capital has declined from US$1 trillion to around US$970 billion within a period of a day. According to experts, the immediate threats to the crypto market rely on the massive sell-off by investors amid heightened inflation fears. Besides, the global crypto lending site Celsius recently ceased withdrawals. Amid these circumstances, investors are continuing to stay away from riskier assets that we can experience in the stock market as well.
Cryptocurrency experts believe that the recent crypto price plunge is generally indicative of the loss of investing appetite amid the investor community. Major cryptocurrencies like Bitcoin and Ethereum have experienced intense losses over the weekend after the major sell-offs due to fears over inflation. BTC and Ether, respectively plummeted as much as 7% and are currently trading at their lowest values.
So, should you invest in cryptocurrencies right now?
Well, the answer to this question will generally depend on what the investor is looking for. Investors who are afraid of suffering massive financial losses may avoid trading cryptocurrencies right now. There are also other investors who will happily buy the dip and are ready to take on any financial risks for that matter. It is quite difficult to predict when the crypto prices will rise again, but the massive number of network developments coming up in the market might also help surge the crypto prices in the near future. Nevertheless, the current sentiments around the market will definitely improve when digital assets move past their bearish trends.