FALL IN THE CRYPTO MARKET
THE CAUSES AND
THE PROSPECTIVE OPPORTUNITY
For a week plus,we have seen the drastic fall in the crypto market, causing panic among the traders and making some to be at loss by selling their assets. In less than twenty four hours, Bitcoin fall up to 15% to $53,000, Ethereum dropped 20% to $2390 and all the altcoins. NOW WHAT IS THE CAUSE?
There has been a fall in the global stock market. Japan suffers worst day since 1987. Tokyo's Topix fell 12.2% . S and P 500 lost 4.1%. The market which has rising Since this year fell because of fear of federal reserve has been too slow to responds which is a sign of weakling economy. Investors predicted that this could lead to increase in interest rate and restrategised by selling their stocks. Adding to the Panic Warren Buffett's Berkshire Hathaway disclosed halving its position in Apple, adding it up by raising $277billion to purchase US Treasury bills in Q2. Also ,Global stock market fell plummeted amid the activities of the Japanese financial markets in which traders had taken the advantage of cheap Japanese interest rate (unlike the US ) by borrowing from Japan to invest in risky projects. Following the strengthening of Yuen in mid July, helped by the increase in the interest rate from Bank of Japan, this reduced the demand of Yuan in the financial markets, hence the fall in the global stock market. As panic increase, traders resort to selling their risky assets, hence the massive selling in crypto market.
While we are in the bearish season in crypto market, this is the best time to invest in Crypto as the investors are waiting for the US Central Bank policy announcement in next month. If the interest rate is reduced, Traders will invest in stock market and crypto market but if it increases,they would invest in US Treasury bills. But there are high expectations that the Interest rate will be reduced next month . This will increase the demand in crypto and will lead to $BTC reaching 80,000.
