Since the beginning of August, the cryptocurrency market has experienced a lot of turbulence, causing widespread concern among investors and traders. This turbulent period was characterized by a sharp drop in cryptocurrency prices, especially Bitcoin, which fell by more than 20% in a short period of time. Many people compare 805 with 312. Compared with the violent three-exploration drop in 312, I think the 805 incident is relatively normal.
Factors of pin insertion:
Global Economic Factors:
The state of the global economy is one of the main reasons for the volatility in the cryptocurrency market. The Bank of Japan's unexpected decision to raise interest rates and shrink its balance sheet set off a chain reaction in global financial markets. The move disrupted global carry trades, caused the yen to surge, and prompted investors to liquidate various assets, including cryptocurrencies, to repay yen-denominated debts. In addition, the U.S. economy is facing recession concerns, with non-farm payrolls data missing expectations and the unemployment rate rising to 4.3%. These economic concerns have exacerbated the sell-off in the cryptocurrency market.
Stock Market
Panic in the stock market spread to the crypto market, highlighting the interconnectedness of these financial systems. Poor performance reported by technology companies further weakened investor confidence and exacerbated overall bearish sentiment. The Japanese stock market circuit breaker brought a series of stock market circuit breakers in the United States. Two major market players, Apple and Amazon, reported performance that was lower than analysts' expectations, and Buffett liquidated a large number of holdings. These are all factors affecting the crypto market.
Political election trends:
Political developments, especially in the United States, have played a crucial role in market volatility. The upcoming U.S. presidential election has brought uncertainty, with prediction markets showing a near-equal odds between former President Trump and Vice President Kamala Harris. The crypto market generally favors Trump, who is seen as a crypto-friendly candidate. This political uncertainty has exacerbated market instability. In addition, continued regulatory pressure on the cryptocurrency industry from U.S. institutions has exacerbated the market sell-off, highlighting the impact of regulatory uncertainty on investor sentiment. Recent lawsuits filed by the U.S. Securities and Exchange Commission against major cryptocurrency exchanges for alleged securities violations have caused further panic among investors.
Insufficient market liquidity:
The current market has seen steady inflows of funds into Bitcoin ETFs, and major financial institutions have also given their approval, indicating a positive long-term outlook. Inflows exceeded $500 million in just a few months. However, the short-term market has been affected by a large outflow of funds from crypto-related investment products, and investor sentiment has clearly turned bearish. The CoinShares report highlighted that crypto-related investment products saw an outflow of $528 million, ending four consecutive weeks of inflows.
7 years of experience in leeks:
We have experienced several major crashes and multiple pains in history. Although the process is quite painful, holding on to the currency is like being a widow, and various objective factors make it impossible to hold on to your investment and eventually sell it at a loss. There is no need to say much about the contract. There is no operation suggestion at the gambling table. Just be prepared to accept the loss. For spot trading, it is recommended to choose targets with relatively strong capital inflows!
There are more than a thousand times more projects in the market now than when we first entered the market, but the number of people remaining in the market is getting smaller and smaller. With few people and little money, we need to learn the following points: first, learn to choose coins, second, allocate funds, and third, learn to adjust your mindset. We firmly believe that there are still many opportunities in the crypto world. When the market is not good, we should calm down and learn more, improve our cognition, and enhance our ability to seize opportunities. Opportunities are always there. Let us encourage each other!
