4 Reasons Why The Crypto Market Will Crash / 7 Reasons Why It Won't

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What if you woke up one morning , grabbed your phone to check your notifications just to see that bitcoin has dropped to 2k dollars?

I mean, would that be the biggest crash of the Crypto market?

The answer to this is actually blowing in the wind because no one knows it. But I was hit with this imagination after I was consulted by a friend who wanted my analysis on the future of the cryptocurrency market.

He was actually proposing that the cryptocurrency market would crash beyond measures comparing it with the Great Stock Market crash of 1929.

He gave so many intriguing and fascinating reasons why this would happen. He hinged it on the fact that history repeats itself. You can actually check out his article on it HERE.

But after giving a critical analysis of his facts without bias and what cryptocurrency is all about, I'm gonna tell you in this post why that crash will not happen.

But then, before I do that, I'm gonna quickly tell you the flip side which is " why the market will crash" if it will 🤔.

If there will be any huge crash in the Cryptocurrency market this year or in the coming years, it will be because of these reasons;

1. The Federal Reserve's gradual increase in interest rates.

We've already survived the first interest rate hike and we're expecting the subsequent ones that will come as U.S battles inflation

2. The impending Third World War which is gaining grounds between Russia and Ukraine.

The invasion of Ukraine by Russia had a great negative effect on the Crypto market and spoke volumes of how the market hated wars and bad news. But I'm also gonna tell you in this post how this proposed war might skyrocket the price of bitcoin and crypto.

3. Strict Regulatory Policies by U.S, China , India and other crypto-phobic countries.

U.S has already stated its intention of imposing regulations on Crypto. Indian Parliament has already passed a law charging 30% Capital Gain Tax on Crypto. Japan's central bank is also clamouring for an urgent Crypto regulation. All these regulatory motives can take a huge toll on the market (It can even crash it)

4. Whales Activity.

It's a normal activity of whales to pump and dump any financial market and can be said to be the characteristics of any market in the global financial sector.

But then, amidst all these intriguing reasons, here are the reasons why the Cryptocurrency market might not crash like the Great Stock Market Crash of 1929;

Volatility: A Blessing In Disguise

Every disappointment as we know is a blessing in disguise and the volatility of the Crypto market which is always seen as the danger sign by every investor is actually its blessing in disguise

The Cryptocurrency market has been known to have a unique magical way of recovering from any huge crash and the reason for the recovery can be simply attributed to what I call the number one unique characteristic of the Crypto industry: VOLATILITY.

Due to volatility, Bitcoin has had huge wrecking crashes in June 2011: -99% (from 32 dollars to a penny), August 2012: -56%, April 2013: -83%, December 2013: -50%,December 2017-December 2018: -84%, March 2020: -50%,May 2021: -53%.

In all these crashes, bitcoin has recovered in every situation and has had an incredible ROI of 8.9 million% over the last decade

So then , which other crash can we say to be the greatest crash in the history of bitcoin?

Volatility is a single feature which makes bitcoin and crypto very flexible and apparently invincible

NB: The Great Stock Market Crash was just about 32% crash. How great that was!! LOL 🤣

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Decentralization Of Bitcoin (De-Fi)

The fact that bitcoin is decentralised is actually the fascinating feature of bitcoin. This single feature remains its best selling point till date. This makes the comparison of Bitcoin market to the stock market simply pointless.

Notice how retail investors and hedge funds are gradually moving from centralised finance into decentralised finance. Everyone wants to own their money. The traditional banks and financial institutions have failed us.

During the Great Depression which emanated from the Great Stock Market Crash of 1929, over 2000 banks failed ,liquidated and closed down with people's hard earned money. No one wants a repeat of that.

Bitcoin and Crypto offers that overwhelming authority over one's financial assets and decisions. It simply does this through Decentralized finance (De-Fi).

Web 3.0 : The Next-Phase Of The Internet

The significant introduction of Web 3.0 can apparently be attributed to the invention of bitcoin. If not that , one can rightly say that the invention of bitcoin magnified the features and attributes of Web 3.0 ( although Web3 has not fully blossomed now).

It simply did this through the invention of Blockchain Technology and Decentralisation of data which were all the products of Bitcoin.

Web 3.0 is simply the next phase of Web development and its only about time before it takes full dominion over the internet.

So then,how can this web evolution which supports Bitcoin and is still in the beginning phase crash into extinction?

Think again!. It's only gonna blossom

Blockchain Technology

Bitcoin gave birth to the use of blockchain technology and since then several sophisticated blockchains apart from bitcoin blockchain has been built by high class programmers and developers.

The application of blockchain technology has now grown widely ranging from the building of Crypto-blogging sites like read.cash, noise.cash to smart appliances (IoT) and smart contracts in insurance.

It's also applied in the medical sector for clinical trial tracking and data record management. It has pretty much found important use cases in other global working sectors.

These alone can skyrocket the prices of Crypto assets in the near future.

Bitcoin and Crypto Dual Utility

The other important selling point of bitcoin and other cryptocurrencies is the dual utility they offer to the entire global economy.

What's this dual utility?

The dual utility of being used to perform a technological or computerized task and also being able to be traded as a currency at the same time.

Bitcoin, Ethereum and most cryptocurrencies are not just some encrypted digital assets but they are also assets that are used to perform one technological task or financial transaction (and they do this with a high transaction speed)

Do you know that XRP (Ripple) is used by renowned traditional banks ( like Barclays Bank etc) to perform financial transactions?

When the world finally embraces these utilities the price of bitcoin and Crypto assets will only skyrocket.

Metaverse And Digital Art

The invention of virtual reality has also been another wonderful evolution of technology and digital art. All thanks to the invention of Bitcoin. The NFT market has grown to be one of the most lucrative businesses in the global financial sector.

Due to its success, the Metaverse virtual reality was introduced and it's now a market which boasts of billions of dollars in market capitalisation.

Crypto-phobic individuals say NFTS and Metaverse are just buzzwords with no intrinsic value or worth but the fact is that these evolutions are just at the starting phase and are yet to reveal the full potential and value they have hiding inside them.

The Russian-Ukrain War (WWIII)

Wars have never been good to any country's economy. The Russian invasion of Ukraine crashed the price of Bitcoin and Crypto market but it only lasted for a while.

Why?

Firstly because, Russian financiers were using crypto to finance the war.

Secondly, Ukraine was offered aid through Crypto

Lastly, Russia sold its gas to buyers through Crypto.

These alone can consolidate to skyrocket the price of Bitcoin and Crypto market as a whole.

Never underestimate the power of Crypto!!

Stay Bullish!!

Mics off! ,😋✌️

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Comments

I hope you're right ;)

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2 years ago