Why Crypto Market is Down Today
Crypto market is a well known market that has been roaming around the globe and is in the mouth of so many people. While we are talking about why is the cryptocurrency market going down? then first we must have to understand that what actually this thing is.
What is crypto market?
The crypto market is called as crypto currency market which is a global market where people buy, sell and trade digital currency which is called as crypto currencies. For your kind information this digital currencies are not backed by any of the central authority like government or bank but it stands on decentralized technologies like block chain to verify and record transitions. Let’s break this down to wire …
What is crypto currency?
Digital currency like Bitcoin, Ethereum , Lite coin exist as crypto currency. This are the digital ledger called as block chain . It is secured by cryptography so that it should be prevented from being counterfeited .And this ensure finer and safer transitions. It is used for various purposes like payments , investment and other applications etc.
Benefits or key characteristics of the crypto market?
1) Decentralized :
It is not controlled by any single entity , but operates on neck to neck network.
2) Volatile :
Prices can fluctuate rapidly at any time due to various factors so it becomes very risky for high value investment.
3) Transparent :
One of the most important feature or you can say that good factor is the transactions are clear and transparent for all.
4) Pseudonymous :
The user’s can t be identified but they can be tracked / traced through there addresses .
5) Global :
This is an important factor regardless having some difficulties in location but is global assessable to all if you have a proper internet connection.
6) Fast and Cheap cross border payments :
As it doesn’t came under any centralized platforms so you can send money very quick without much paper work and with lower fees than the traditional banks
7) Financial inclusion :
It also provides financial support to those who are unbanked or under banked . It is a great initiative for those who have lost there credibility from the traditional banks for some reasons.
8) Innovation :
Block chain technology has underlying crypto potential for various applications beyond finance.
As per reports of December 2023 , the crypto market is not doing as well as it should be . Bitcoin the biggest player is down about 1.23% over the past 24 hrs. but the major coins like Ethereum and BNB are showing slight gains , while it can be fluctuating . Some reasons why we should be know are –
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Macroeconomic factors :
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Interest rates :
Rising interest rates , as set by the federal reserve can make traditional investments like bonds are more attractive , leading investors to pull money out of risk takers like crypto .
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Inflation :
High inflation in crypto nervous the investors as it can affect the value of holding over the period of time .
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Global economic uncertainty :
Events like the war in Ukraine , War in Israel are big factors in international market , supply chain disruptions and political instability leads to fall of crypto value in the international market . It will make the investors search for safer deposits of there funds .
Crypto specific factors :
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Regulation :
increasing government regulations on Crypto stands out a major issue in the crypto industry which is now not encouraging more investors towards the market by creating uncertainty and sell offs .
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Technical factors :
Market corrections and liquidations can sometimes happen for purely technical reasons , unrelated to any specific news or event .
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Negative news :
Events like hacks , scams or thefts also affects the trust of the investors and it will lead to price drops . So it is very heavy load for now .It is important to remember that crypto market is highly volatile and even small changes can affect the factor and it can lead to significant mood swings .
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Exchange collapses :
The downfall of large exchanges like FTX undermines investors confidence and leads to instability in market and it affects the total market which bring losses to whole investors and there trusts gets affected though .
Conclusion :
Crypto market is a big ocean where you have to be ready to face the tides if you are going on a ride , so have the courage enough to get into the market and yes success comes with losses . So keep your research going
