Crypto Market Showing No Sign of a Comeback
This year, arguably, has been one of the best for cryptocurrencies, with a few of them reaching new all-time highs [ATH]. Started strongly but things took a different turn three weeks ago when the crypto market experienced a massive fall in price.
The first fall was a result of Biden's new tax laws which required crypto-asset holders who experienced massive gains to pay more in tax, this moved most investors to quickly dump almost every high-valued assets they owned, resulting in the fall of the market. While the market gradually recovered, it was hit by Tesla’s announcement to halt accepting payments in Bitcoin, citing energy consumption as the cause.
While most traders and enthusiasts are bullish on the market, the recent happenings all point to one thing — there may be no comeback for this market, at least for now.
Bitcoin, the premier cryptocurrency, is known to weather the storm. Having fallen below the $10k mark back in 2020, the cryptocurrency being the foremost always gets back on top, some of the time taking a long time. Presently hovering around the $36k price as reported by CoinGecko, this virtual currency has sat on that spot for weeks without any significant improvement.
Ethereum, on the other hand, the premier DApps blockchain also experienced a massive fall in price, falling below expectations even after unlocking a new ATH. DOGE, a meme coin that was brought to limelight by Elon Musk's tweets, is presently still on $0.32 even after the SpaceX CEO made a couple of tweets about it last week.
All of these happenings point to the singular fact that the comeback we're anxiously waiting for may take longer than envisaged.
Also, a ton of Bitcoin traders have had to stop losses by either swapping their assets for stable coins like USDT, further ensuring that they do not lose more. As reported in a tweet by leading exchange Binance, a Bitcoin whale last week withdrew over $630 million worth of BTC from the platform. Surprisingly, this massive withdrawal did not have any effect on the market, as it should have.
With most traders, especially those in developing countries already in panic after losing thousands of dollars to the market, they may be discouraged to further invest in the market. Currently, these developing countries make up some of the most active traders of Bitcoin and altcoins. Whilst most of their home governments are clamping down on virtual currencies, citizens are keen on learning more about them and have invested more. An example of one of these countries is Nigeria, the West African country bordered to the east by Cameroon and Chad.
After a ban on all crypto transactions, reports reveal that the African nation tops the charts as the country with more interest in virtual countries, this is months after the supposed ban. Seeing virtual currencies as a store of value against their falling local currency, this recent dip may deter their zeal to further invest in the market.