Thursday, January 27, 2022

What Is Wrong With The Crypto Market

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Why Has The Cryptocurrency Market Crashed

ARE WE WRONG ABOUT CRYPTO MARKET CYCLES AND PREDICTIONS?

    BITCOIN and other top cryptocurrencies have crashed in price in December.

    The world’s biggest digital coin plummeted more along with the rest of the crypto market which shed a fifth of its trillion dollar value.

    The drop on December 4 wiped billions from the crypto market, and came less than a week after Bitcoin reached a record high of over $69,000.

    The sharp fall wiped around $300 billion worth of value from the combined crypto market in just two days.

    Bitcoin, the number one cryptocurrency is still trading lower at £46,674.68 at the time of writing according to Coinmarketcap.The

    Other major players including ethereum, Binance coin, solana, cardano and Ripples XRP have experienced drops too and remain lower.

    If you’re thinking of investing, keep in mind it’s a risky business and you’re not guaranteed to make money.

    You need to make sure you know the risks and can afford to lose the cash, and never invest in something you don’t understand.

    Which Crypto Prices Are Down

    Bitcoin wasnt the only cryptocurrency to feel the initial effects, with most of the top 10 all experiencing dips in value.

    Dogecoin, which was initially set up as a joke in 2012 before seeing its shares skyrocket, has also dropped while Solana has seen its market price rise by more than 8%.

    Musks influence cannot be underestimated as, even though the likes of PayPal, Mastercard and have backed cryptos, the Tesla announcement still rocked the market.

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    You Fall For Media Propaganda

    Major news sites will sometimes release very negative, and often, threatening news.

    The news may be about a country banning the use of cryptocurrencies, or about how Wall Street doesnt want to get in.

    A lot of these news articles are intended to generate clicks, controversies, and sometimes even FUD. Its often very exaggerated.

    One more style of content that can negatively persuade you is sponsored content. Websites and media you trust will promote a product not because they use it and like it, but because theyve been paid to promote it.

    Sponsored content is fine as long as it is clearly noted that the content is paid for. Many times, sponsored content looks just like non-sponsored content, which can be deceiving.

    The most effective change you can make to improve your long term cryptocurrency investment strategy is to read these articles – not just the headlines – and cross-reference opinions. Stay calm and remain skeptical at all times.

    Also Check: How To Track Crypto Transactions

    What Is The Problem With Cryptocurrency

    Bitcoin is again inthe news. Some advocates of the cryptocurrency suggest its price is risingbecause bitcoin is challenging golds standing as the one supra-currency, theasset to own when fiat currencies are being debased. Does bitcoin offersomething unique as an emerging store of value, blending some of the benefitsof technology and gold? Chi Lo, senior economist for Greater China, provides his analysis.

      You Dont Prepare For Bull Markets

      What

      Do you believe the market is dead and the entire crypto industry will vanish away just because Bitcoin drops 40%? Of course not. These cycles happen, so dont be afraid to go against the crowd.

      If you sold when you were in profits, then you should have fiat ready to invest in cryptocurrencies during bear markets.

      Keep these funds available in your wallets and be ready to accumulate your favorite cryptocurrencies when everyone else in the market is panicking.

      But, dont FOMO! Generally, bear markets can last for well over a year. If you buy the dip too early, youll end up losing a lot of money.

      Bear markets should also give you plenty of time to find some altcoins worth investing in. So do not wait until the bull market is back – do your research in advance.

      Recommended Reading: How Many Cryptocurrencies Are There On Coinbase

      An Easier Way To Buy Crypto With Etoro

      Join the 20 million users who trust their investments with eToro.

      You can start investing from as little as $50.

      Choose from a selection of crypto assets including Bitcoin, Ethereum and Dogecoin. You can practice risk-free, with a virtual investment account.

      Cryptocurrency investing within the EU & USA is highly volatile, unregulated in most EU countries and the UK. No consumer protection. Not supervised by the EU or UK regulatory framework. Investments are subject to market risk, including the loss of principal.

      Read More About Cryptocurrencies From Cnbc Pro

      The Ark Innovation ETF, a fund of high-growth stocks led by star fund manager Cathie Wood, is down more than 30% from its February highs. As of Wednesday morning, the tech-heavy Nasdaq Composite has fallen 6.9% from its most recent closing high on April 26. The small cap Russell 2000 is down 5.6% over the same period.

      The declines have also coincided with the delayed deadline for tax payments, which could have caused selling pressure as investors looked for cash to pay off capital gains tax liabilities.

      Read Also: How To Add Cryptocurrency To Turbotax

      Where Is The Cryptocurrency Industry Headed In 2021

      Bitcoin, as of December 2020, has experienced a steady rise to reach new all-time highs, breaking through $20,000 per BTC, but it was not always so steady.

      To get a sense of just how troubling the market had been, just look to 2018: Heading into 2018, Bitcoin traded for close to $13,500 after reaching an all-time high of $19,783.06 in December of 2017. It subsequently dropped as low as $3,400, a loss of about three-quarters of its valueand other digital currencies weren’t faring much better at the time. Ethereum , for example, fell from an early-year high of $1,300 to just $91 by December 2018 before rallying back to over $450 by the end of 2020.

      Cryptocurrencies like Bitcoin and Ethereum have indeed proven resilient. Investor interest, both retail and institutional, in digital currencies has risen dramatically in recent months. Many early investors who were eager to make gains from the “cryptocurrency craze” have since moved on to other ventures, leaving a smaller group of stalwart HODL-ers behind. But there are still reasons to believe that the cryptocurrency industry has some fight in it left.

      Investors are again asking: how high digital coins could fly? And Bitcoin indeed has risen back to all-time highs as of December 2020, reaching over $23,625 and Ethereum to nearly $700. Now, looking into the end of 2020 into 2021, the better question might be how this space will adapt in order to survive.

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      Crypto Rant | What Most People Get Wrong In Crypto

      Cardano, XRP, and Shiba Inu are also down. Dogecoin is soaring in contrast to the rest of the market though, up nearly 33% in the past day.

      The latest plunge comes after it was revealed that 90% of all bitcoins have been mined.

      New research shows that 18.89million coins have been mined out of 21million, which is the maximum.

      Meanwhile one of the biggest crypto exchanges, Binance, said it will close its trading platform in Singapore after clashing with regulators.

      Dogecoin’s rise came after billionaire Tesla entrepreneur Elon Musk said the cryptocurrnecy will be accepted as payment.

      He tweeted: “Tesla will make some merch buyable with Doge & see how it goes”.

      Early December’s crash was thought to be driven by mounting fears that global governments could crackdown on crypto regulation.

      Also Check: How To Store Crypto In Cold Storage

      Is Teeka Tiwaris American Crypto Summit Legit

      In a presentation titled The American Crypto Summit: The Final Countdown, Teeka Tiwari explains why he believes the most explosive event in crypto history will occur on December 1, 2021.

      He calls this event the Final Countdown and says it could send the crypto market soaring into the stratosphere.

      What is the Final Countdown event? And what cryptos is he teasing?

      Thats what I intend on shedding some light on in this article. Ill give you the full details behind this so-called final countdown event and what crypto opportunities hes bullish on.

      Ill also give you the heads up on the advisory service hes pitching, Palm Beach Letter, to help you decide if its worthwhile.

      Recommended:Go here to see my #1 recommended stock advisory service

      Why Are Cryptos Falling

      After topping $64,000 in April, bitcoin has struggled to reclaim its all-time highs since then following a series of events. It came under pressure in May after tech billionaire Elon Musk, who has driven traders into frenzies by mentioning cryptos at times, said Tesla will stop using Bitcoin as a form of payment over concerns of the cryptocurrency’s impact on fossil fuels.

      Since then, cryptos have gyrated as coins such as ethereum typically to move in tandem with bitcoin.

      In early June, bitcoin fell further amid concerns of its use in the Colonial Pipeline ransomware attack.

      Bitcoin, for instance, briefly touched $40,000 last week and fell again Monday after China’s central bank deepened a crackdown on cryptocurrencies. China’s central bank said it ordered some banks and payment firms, including China Construction Bank and Alipay, to crack down further on cryptocurrency trading.

      Bitcoin shed more than 10% on Monday, its largest one-day drop in over a month.

      Also Check: Which Crypto Uses Least Energy

      You Invest Your Life Savings

      Rule number one of investing dont invest more than you can afford to lose.

      You should go into this ready to lose whatever you put in. Ultimately, as the price swings up and down, you should remain calm and still be living a healthy life with room for regular spending.

      Ive heard countless horror stories of people investing greedily with their entire life savings or borrowing large sums of money. This is a HUGE mistake.

      Funny enough, even if you hit it big, your greed will likely win you over. For example, if you invest $50,000 and at one point have $150,000, then your mind will rationalize and normalize these winnings to feel less significant than they are.

      The next thing you know, the market drops, and you are back at break even, or at a loss.

      What Do We Know For Sure

      April Showers Bring a Crypto Rally

      While it’s difficult to say which, if any, digital currencies will see dramatic price gains in 2021, we can say with confidence that cryptocurrency is not going away anytime soon. Blockchain, the underlying technology behind many cryptocurrencies, has spread far outside of the digital currency industry and is likely to see new applications this year. Governments and regulators will continue to grapple with how to best facilitate and control digital tokens.

      The heyday of cryptocurrencies may have come and gone, but it’s also possible that the crypto market still has a lot of upsides to go. We do know one thing for sure: cryptocurrencies were once positioned to upend the entire financial system. That kind of noise doesn’t disappear overnight, so expect to hear from cryptocurrencyor at least its number-one fansfor another year at least.

      Also Check: What Is Kyc In Crypto

      You Dont Own A Hardware Wallet

      I will be straight up: if youve invested more than $500 in cryptocurrencies, then hardware wallets are a smart investment.

      They are disconnected from the internet, which means that hackers can only obtain your funds if they steal your physical device and also know the passphrase to access it. This makes security a much easier task.

      If you have large amounts of money, say over $5,000, then it may be worth buying two. The second can act as a copy to the first one, in case you lose it.

      What Are Teekas Two Tiny Cryptos And Four Backdoor Profit Plays

      During the presentation, Teeka said that a select few smaller coins will outperform Ethereum. And he details two of his top picks in a report titled The Final Countdown Buy List: Two Tiny Cryptos to Own Now.

      He also says hes buying behind-the-scenes companies that are laying the groundwork, the infrastructure, for crypto to go mainstream. And he details his top four picks in a research report titled The Final Countdown: Ultimate Backdoor Profit Plays.

      He doesnt reveal the names of any of these. All he really says about the cryptos is that one of them trades for just over $1 and is backed by some big-name companies like Coinbase.

      However, he does provide a clue about one of the backdoor profit plays hes bullish on, and based on my research, I believe that one of these companies is Bakkt Holdings .

      Why?

      Firstly, because he describes one of these backdoor profit play companies as an exchange or toll taker. And what he described reminded me of a presentation I wrote about on July 21, 2021 about Genesis Technology.

      Otherwise known as his investment of the decade presentation.

      You can see the full article here. But to summarize, based on the clues he provided in that presentation, I came to the conclusion that one of the companies he was teasing was Bakkt.

      And what he says in the American Crypto Summit presentation sounds very similar to what he said about Bakkt in the Genesis Technology pitch.

      Top pick:Get insider stock picks from real money managers

      Recommended Reading: Which Crypto Exchange Accepts Credit Card

      You Dont Understand The Technology

      What makes Bitcoin and many cryptocurrencies innovative is their underlying technology. But if you dont understand the foundations of the technology, the road will be risky.

      You dont want to rely on others knowledge to make your crypto investment decisions. Until you can judge these projects for yourself, you will be missing out on big opportunities.

      After all, the creators of Bitcoin and its first adopters were all techies.

      To avoid this, find educational sources you trust, take the time to learn, and most importantly, enjoy the journey of learning.

      Once you understand block rewards, consensus algorithms, premining, and all the fancy jargon, you will be an improved, independent investor.

      Blockchain technology is continuously advancing, so keep up with it the best you can.

      You Make Sloppy Mistakes

      CRYPTO MARKET DIP EXPLAINED!! (BIGGEST BUYING OPPORTUNITY)

      Hold your horses, buddy! Take your time when transferring your money.

      Dont rush, and make sure the sending and receiving addresses are correct. Never type an address. Just copy and paste them. This way you avoid any chance of typos. And hey, its faster!

      After you copy and paste it, always verify the first two characters and the last three characters match your address.

      Also Check: What Cryptocurrency To Invest In

      You Can Now Opt To Invest Through Online Brokers Like Robinhood Or Crypto Exchanges Like Coinbase Heres What To Know Before You Do

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      Investing in crypto may be easier and faster than ever you can now opt to invest through online brokers like Robinhood and SoFi Invest or crypto exchanges like Coinbase and Gemini but its far from being a foolproof venture. Many of the same risks and pitfalls that vexed crypto pioneers can still cause headaches for those entering the field today. Thats not to say that navigating the crypto universe requires a masters in computer science or finance rather, it just means that some of the financial resources, protections and patterns investors have come to expect when trading stocks and bonds will be different when trading crypto. Learning the rules of this new digital investment game is essential and could potentially save you from making mistakes worth thousands, or even millions of dollars. Here are a few mistakes that new crypto investors often make when they get started, as well as some things to consider before taking the plunge.

      Mistake No. 1: You dont buy the right stuff

      Ready to get into crypto? You can buy Bitcoin, Ethereum and other cryptocurrencies via online brokers like Robinhoodand SoFi Invest or crypto exchanges like Coinbase, Gemini or eToro.

      Mistake No. 2: Youre not prepared for a wild, wild ride

      Mistake No. 3: You dont double and triple check the address

      Mistake No. 4: You forget your password

      You Chase Cheap Coins

      Dont chase cheap coins with dreams of lambos and private jets.

      Lots of uneducated investors in the crypto space buy low priced cryptocurrencies because they think there is a higher chance of big returns.

      If presented with one coin priced at $0.01 and another at $75, they blindly purchase the $0.01 coin because they think its easier for a coin to go from $0.01 to $0.02, rather than from $75 to $150.

      This is a common trap.

      There are lots of factors that affect a coins price, including two important ones: the circulating supply and the real world value of the coin.

      More often than not, a cheap coin has a huge supply of coins, which dilutes the price of each coin. If the supply is massive and there is little real-world value, then the coin priced at $0.01 is not undervalued and should be priced that low.

      A better factor to consider when looking for coins with growth potential is the market capitalization of the coin. The market cap is calculated as and is often a better indicator of a coins valuation by crypto investors.

      If you want to find the next gem coin, look for coins that have a low market cap.

      Low market cap coins have more potential for growth, but they also come with a lot more risk

      Ultimately, you should stay away from those coins if youre still at a beginner level, and pick your next investments based on their potential real-world value.

      Recommended Reading: Should I Invest In Multiple Cryptocurrencies

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