Zug, Switzerland — The last few days have been extremely turbulent for the crypto markets, but also for the traditional markets. Especially the altcoins show double-digit percentage losses. The reasons for the loss are manifold.
The markets were basically in a difficult situation in the past period. The corona crisis in China, the war in Ukraine and the inflationary developments in the USA all made their contribution. This weekend, the third largest stablecoin, Terra USD (UST), now also lost its peg to the U.S. dollar, sending the price of LUNA into a tailspin. Attempts to restore the exchange rate peg led to additional selling pressure on Bitcoin and Ethereum, while the market was already in a downtrend before the weekend. Currently, a number of political, economic, and resulting uncertainties among investors are also likely to be the main cause of the general sell-off in global financial markets, which in turn is depressing prices.
In our opinion, we had similar price developments in 2018, which subsequently recovered, which is why we expect a similar development now. Currently, Bitcoin seems to be able to maintain a relatively stable position amid all the turmoil in the financial markets. We expect the markets to perform better in the coming months and see the current market situation as a potential opportunity for the crypto industry.
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