The carnage was so intense that major cryptocurrencies, including behemoths like Bitcoin and Ethereum, lost up to half of their value from the peak, while other altcoins felt more pain.
The tapering cues from the Federal Reserve, rising bond yields, crackdown signals and regulatory strictness weighed on the sentiments of the crypto space.
It appears that the world is coming to an end for the crypto community, and the crypto market is a dead rubber. After a brief recovery, the digital token market was back in red on Monday afternoon.
The crypto market has tumbled lately, said WazirX Trade Desk, adding that it’s too early to say that the crypto market is dead.
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Supporting his argument, it said that Intel is stepping into the Bitcoin mining industry — planning to unveil a bitcoin mining chip, and about 300 banks have plans to launch bitcoin trading in the first half of 2022.
“Microsoft has purchased Activision, a leading game developer in the world, reiterating its focus on ‘Metaverse’ and Instagram plans to integrate NFTs while Twitter is rolling out NFT verifications,” it added.
Market experts said that the latest fall in the crypto market is not any industry-specific phenomenon. Financial markets across the board have taken a hit, jittering the sentiments in the digital token space.
Unfortunately, crypto is still quite correlated with the stock market, and anything that happens there will eventually affect the crypto market, said Edul Patel, CEO and Co-founder of Mudrex.
“Fears over the rates hike by the US Fed has kept financial markets on their toes,” he added. The Federal Reserve’s two-day policy meet will kick off on Tuesday and the crypto space would be keenly watching it.
However, China surprised the markets with its rate cut as the property developers in the world’s second-largest economy have started to implode. It is an attempt to push domestic markets higher.
Market experts believe that the cryptocurrency market would not go lower from the current stage and discard the theory that the market is dead.
“With several institutions raking in billions of dollars, it is a good buying opportunity,” said Patel of Mudrex. “A look at the on-chain metrics clearly shows that the whales are continuously buying the dip right now.”
When the fundamentals are holding or are getting better during the falling market, it is an opportunity instead of a threat, suggest the market experts.
The cryptocurrency market has seen many big and small falls since one last year and has always bounced back all the time, said Gaurav Dahake, CEO & Founder Bitbns.
The stock market has also been underperforming for the past few months, but it still enjoys investor confidence in it, he added. “It is required to have some patience in the crypto investment and wait for some regulation clarity from the Fed, which would stabilize cryptocurrency.”