The crypto markets continue to crash. Over the last 24 hours, bitcoin – the world’s largest and most popular cryptocurrency by market cap – has fallen another $1,000 and is now trading in the mid-$28,000 range. Many are wondering if it is pointless to have hope anymore as investors continue to lose faith in the ever-changing crypto market.
The Bitcoin Crash Has Been Occurring for Months
Bitcoin isn’t the only asset failing at the time of writing. Solana has fallen by nearly 13 percent. Ethereum has also dropped about ten percent, while BNB token has lost close to nine percent. In just the last day, several digital currencies have lost ground (bear in mind this article was initially written at the end of May).
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Many analysts, naturally, are offering their two cents on the situation, explaining either the reasons behind the drops or talking about what traders can expect in the future. Shivamm Thakral – CEO of BuyUcoin – stated in an interview:
The crypto bear market is in for a long haul as the overall crypto market cap fell by over five percent. Bitcoin is struggling to cross the $30K mark [again] and ether is under a lot of pressure after slipping below the $1,700 mark. Layer one coins like Solana and Avalanche have suffered double-digit losses and the total value locked in the defi ecosystem witnessed a significant drop.
He did mention, however, that nobody can specifically blame crypto or label it as a failing asset class, as several additional classes are also experiencing massive dips at press time. He commented:
It is important to note that crypto is not the only market in a bear phase. Some of the most high-paced tech stocks have faced a major downward trend which is a result of several macroeconomic factors putting pressure on the traditional and crypto market across the globe. The markets are expected to remain choppy, and investors should hold onto their position.
Sharat Chandra – crypto expert and vice president of research at Earth ID – mentioned:
Crypto assets have briefly decoupled from rising stock prices. Despite the short-term volatility, the 90-day co-relation between bitcoin and S&P 500 is at an all-time high. Altcoins have a higher risk profile. Therefore, altcoins performing poorly against bitcoin indicate lower risk appetite among investors in a bear market.
Will the U.S. Do Good Things for Crypto?
Lastly, the Coin DCX research team says that the U.S. could play a bright role in the future of crypto, saying:
Amidst market uncertainties, the US Federal Reserve’s vice chair Lael Brainard has reinvigorated confidence in crypto, seeing the necessity of a central bank digital currency of the U.S. dollar and its position to coexist with stable coins. Even going so far as to put a five-year timeframe to the digital dollar’s launch, Brainard expounds on the criticality of embracing digital currency and the risks of not engaging with the future digital financial system.
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