Crashing Crypto Market

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Bitcoin has lost more than two-thirds of its value while Ethereum has lost almost 80% from its peak. As a result, the overall market capitalisation of cryptocurrencies has dropped under $1 trillion for the first time since January 2021.

In order to fight inflation, The US Federal Reserve has tighten the monetary policy due to which there is fall in prices of stocks.
According to some analysts fall in prices of stocks also have led to crash of the crypto currencies market.
As central banks withdraw liquidity from the market, there’s less money chasing assets, which in turn causes the prices of assets to drop.

Some sceptics have also stated that, while private cryptocurrencies may eventually become viable alternatives to fiat currencies, governments and central banks may refuse to allow this.
Many countries have taken steps to hinder broad adoption of cryptocurrencies.
While some governments, such as China and Russia, have openly banned cryptocurrencies, others, like as India, have attempted to aggressively tax and regulate them.
While the government of India has not issued a blanket ban on cryptocurrencies, the Reserve Bank of India has been vociferous about the need to do so.

Cryptocurrency supporters believe that cryptocurrencies like Bitcoin have always been prone to wild price swings, and that now is a great moment to buy these virtual currencies at a discount.
To be honest, many crypto-enthusiasts have profited handsomely in the past when they purchased cryptocurrencies during panic selling periods.
They suggest that, similar to gold, cryptocurrencies shield investors from price inflation.
It’s worth noting that, unlike central bank-issued fiat currencies, the quantity of various cryptocurrencies is limited by design.
Investors can protect themselves from central bank debasement by storing their wealth in cryptocurrencies that preserve or even increase in value over time.

Source The Hindu

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