There’s blood on the crypto streets as a mammoth market sell-off exceeding $300 billion has caused the blockchain industry to retreat.
On Sunday, the global market cap stood at a record high of $1.76 trillion. In less than 48 hours, it’s down to $1.46 trillion and looks set to piledrive towards an even steeper downwards trajectory.
As prices trickled down to embarrassing lows since markets reopened on Monday morning, the trading bubble expanded as investors tried to get out of it. According to CoinMarketCap, the biggest drop was Bitcoin. From highs of $58,000 over the weekend, it went to $47,700 in just 19 hours.
This was the largest single-day fall Bitcoin has ever seen. Crypto watchdogs who’ve been following this trend took to Twitter and had some interesting insights. The following image probably takes the cake:
Albeit the losses are huge, experts and analysts suggest this is all part the Bitcoin’s cyclical price shifts. What does that mean exactly?
“Get high on lows.”
— Moonlight (@g_guzardus) January 11, 2021
If you’re a seasoned buyer and are accustomed to the concept of “buying on lows”, then you’d probably feel relieved this happened. Bitcoin supporter Raoul Pal agrees:
It it just me that feels relief when the BTC sell offs come? You know they are coming but when they finally arrive you can switch into buy the dip mode. March is a historically weak month. Not sure if this is the bigger March correction of just another cheeky shakeout . pic.twitter.com/GMH7evctX5
— Raoul Pal (@RaoulGMI) February 22, 2021
While ‘overvalued’ assets such as stocks and cryptocurrencies are the biggest risk to economic recovery, the V-shaped trajectories observed in the past few months suggest there’s room for recovery if the investors’ emotional purview is able to withstand the damage.
So, while the crypto-believers are content with the notion that “some things just crash” more astute investors would be wise to focus on the bigger picture and plan accordingly. Cryptocurrencies are definitely in it for the long haul.