Last night, the crypto market experienced a significant drop, raising many questions among investors and analysts. Several global events over the past 24 hours appear to have contributed to this decline. Which ones?
Why did the crypto market collapse last night?
Tonight, the crypto market saw a notable decline, with Bitcoin falling to $62,200, recording a 1.48% decrease over the past 24 hours. Several factors contributed to this sudden decline, which we will explore in detail.
- First, the surge in Chinese stocks.
Indeed, investors were attracted by the promising returns of Chinese stocks, which diverted funds from cryptos like Bitcoin. This reallocation of investments has caused a temporary decline in the crypto market, as investors seek to maximize profits by moving to more stable and potentially more lucrative markets.
- Then, the loss of short-term investors.
Short-term BTC holders lost $6 billion in one week, going from $17 billion to $11 billion. This increased volatility has likely contributed to the crypto market's downfall as investors re-evaluate their positions in the face of current economic uncertainty.
- Finally, geopolitical tensions.
Yesterday, October 7, 2024, marked the anniversary of the deadliest attack on Israel by Hamas. Although this dark anniversary does not have a direct impact on the crypto market, the conflict it represents generates uncertainty among investors, who are now taking a more cautious approach to cryptos.
Soon a return to normal?
The crypto market's fall could be temporary. Analysts predict it could recover once China's stock market stabilizes, although uncertainty remains. Investors should remain vigilant as global economic fluctuations and geopolitical tensions continue to influence financial markets.
Finally, the crypto market's fall last night can be attributed to a combination of Chinese, geopolitical and economic factors. These elements led investors to reevaluate their portfolios and reduce their exposure to cryptocurrencies, thus causing a temporary decline in the market.
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