Causes of the market crash:
Federal Reserve (Fed) Statements:
Jerome Powell, Fed Chairman, stated that the institution cannot own Bitcoin, under current laws. This statement cooled expectations that the Fed could incorporate Bitcoin into its reserves, an idea that had gained traction after Donald Trump's electoral victory.
Interest Rate Cut with Restrictive Approach:
The Fed announced an interest rate cut, but with a restrictive tone, which generated uncertainty in the financial markets. This approach can negatively affect risk assets, including cryptocurrencies.
Natural Market Correction:
Bitcoin reached an all-time high of around $108,000 on December 17, followed by a correction that took it to lows of approximately $100,000 on December 18. These types of corrections are common after reaching all-time highs.
Personal Assessment:
It is essential that you analyze your risk tolerance, investment horizon, and financial goals before making decisions. If your focus is long-term, you might consider holding your current positions as cryptocurrencies often experience short-term volatility.
If you prefer a more active strategy, you could take advantage of corrections to acquire more assets at reduced prices, as long as you are willing to take the associated risks.
Diversification and Risk Management:
Diversifying your portfolio and setting clear limits for potential losses can help you mitigate risks in volatile markets.
You can also use safer investment methods like binance earn or discover airdrops and lock tokens in launchpool.