The cryptocurrency market has been experiencing a significant downturn over the past few days, with almost all major coins losing a significant amount of their value. This market-wide drop is causing concern in the crypto community, with traders, investors, and analysts alike trying to determine the cause of this slump. In this article, we’ll take a closer look at what’s causing this crypto market downturn and analyze its key factors.
One of the primary factors behind the current crypto market downturn is the recent crackdown on cryptocurrency mining in China. The Chinese government has been taking a hard line against Bitcoin mining, with major mining hubs such as Sichuan and Inner Mongolia shutting down operations due to concerns over energy consumption and financial risks. With China accounting for more than 65% of global Bitcoin mining, this crackdown has caused a significant decrease in the overall hash rate, making it more difficult for miners to process transactions and earn rewards.
Another significant factor contributing to the current market downturn is the increasing regulatory scrutiny of cryptocurrency in general. Governments and financial regulators across the world are trying to control the fast-growing crypto sector, with many countries looking to create regulatory frameworks to govern the use of cryptocurrencies. For example, the US Securities and Exchange Commission (SEC) is currently reviewing a Bitcoin ETF application from VanEck, which could pave the way for greater institutional investment in crypto. However, the SEC has delayed its decision on this application several times, which has led to uncertainty in the market.
A third factor contributing to the crypto market downturn is the ongoing global pandemic. The COVID-19 pandemic has caused significant disruptions to global markets, with many investors seeking to move away from high-risk investments such as cryptocurrencies. The pandemic has also caused significant economic uncertainty, which has also contributed to a decrease in crypto prices.
At the same time, there are some positive developments in the cryptocurrency industry that could have a positive impact on the market going forward. For example, more and more mainstream financial institutions are starting to embrace cryptocurrencies, with major firms such as PayPal, Square, and Tesla investing in Bitcoin and other coins. This represents a significant shift in the financial landscape, as institutions that were once skeptical of cryptocurrencies are now starting to see the potential benefits of these digital assets.
In addition, the development of decentralized finance (DeFi) is also a positive sign for the cryptocurrency market. DeFi protocols allow users to access a range of financial services, such as loans and insurance, using cryptocurrencies. These protocols are built on blockchain technology, which makes them more secure and transparent than traditional financial services. As more and more people start to use DeFi platforms, we could see an increase in demand for cryptocurrencies, which could drive up prices.
In conclusion, there are several key factors contributing to the current crypto market downturn, including the crackdown on mining in China, increasing regulatory scrutiny, and the ongoing pandemic. However, there are also some positive developments in the industry that could help to drive the market upwards, such as the increasing adoption of cryptocurrencies by mainstream financial institutions and the rise of DeFi. As always, it’s important for investors to be aware of these factors and to make informed decisions about their crypto investments.
The cryptocurrency market capitalization experienced a bounce last week, validating the $1.10 trillion horizontal support area. However, the bounce wasn’t strong enough to negate the preceding bearish engulfing candlestick, leaving uncertainty about whether the price will resume its upward trajectory or break down toward the next support level.
Bitcoin’s average daily transactions over a week reached a new all-time high of 396,350. Venmo is launching a new cryptocurrency transfer feature, allowing users to transfer cryptocurrencies between Venmo wallets.
Similar to TOTALCAP, the Bitcoin price last week wasn’t sufficient in clearing the main resistance at $29,700. Additionally, it didn’t negate the previous bearish engulfing candlestick. If a decrease follows, Bitcoin could fall to the next closest support at $24,400. However, if the price breaks out, the rate of increase could accelerate to $42,500.
The SingularityNET (AGIX) price has been decreasing inside a descending wedge since March 17. Typically considered a bullish pattern, an eventual breakout from the wedge is the most likely scenario. However, AGIX has touched the wedge’s support line multiple times, indicating that a breakdown from the pattern is possible.
If a breakdown occurs, the price could decrease below $0.28 and fall to $0.20. On the other hand, if it bounces, an increase to the wedge’s resistance line at $0.34 is the most likely scenario.
In conclusion, the crypto market’s recent downturn has created uncertainty for various cryptocurrencies, with key support and resistance levels being closely watched by traders and investors alike. The market will continue to be volatile and unpredictable, with various factors such as economic indicators, regulatory actions, and technological developments affecting the price movements. As always, investors are advised to exercise caution and conduct their own research before making any investment decisions.