Check Out These Three Major Factors That May Have Caused The Crypto Downtrend According To Chris Burniske - Crypto Coin Press - Crypto News, ICO's, Analysis, Live Prices

Check Out These Three Major Factors That May Have Caused The Crypto Downtrend According To Chris Burniske

The downtrend in the cryptocurrency market is no longer News. Even those who aren’t active investors are aware that the price of cryptocurrencies as well as the market capitalization is plummeting. Several experts have come up with possible reasons for the price crash. At first, everyone blamed it on the Bitcoin Cash fork, but the price has continued to fall even after the update has been completed.

Bitcoin (BTC) Price Today – BTC / USD

Name Price24H (%)
$4,364.67 8.03%

Chris Burniske Gives Three Possible Downtrend Catalysts

A Placeholder Management partner, Chris Burniske, has given three possible reasons behind the downtrend. According to him, the crash is as a combination of the retracement of the United States stock market, Bitcoin Cash fork war and major Ethereum ICO sell-off. Within the last seven days, about $55 billion has been removed from the market capitalization thanks to the crash in the price of major cryptocurrencies starting with Bitcoin. The losses suffered within this period range from 10% to 50%.

For some months now, the United States stock market has been trending on a declining channel after Dow Jones experienced a crash in value. Things like mortgage, credit card and student loans are reaching higher highs driving the US economy to a crisis that might be similar to the 2008 crisis. Corporate debt within the United States alone is reportedly now about $9 trillion. This is posing a serious threat to the economic stability.

Director of credit research at Amundi Pioneer, Michael Temple had this to say about the current economic crisis:

“The question is how long do we have until the debt cycle turns? How long do we have until interest rates start snuffing out economic activity. Before now, experts complained about the interest rates being too high stating that recession may occur soon. This is a big problem”.

Burniske suggests that the sudden drop in the stock market is propelling investors to sell-off. They are selling high risk assets like cryptocurrencies first. He continued:

“When there is an economic downturn and people are trying to clean out their portfolios, the riskiest assets go out first. This is certainly what is happening with cryptocurrencies right now.”

He went on to explain that the Bitcoin Cash war and the ICO sell-off are also triggers that led to the cryptocurrency downtrend. These factors have caused a 21% fall in the valuation of the cryptocurrency market as a whole. In the history of the industry, this is the fifth worst correction recorded.

Is There Any Hope For Cryptocurrencies?

Within the nine years since its inception, the cryptocurrency market has had 4 major price correction minus the current one. Statistics show that the fall from an all time high of $19,500 to a disappointing low of $4,050 is the least significant price correction of all.

What this means is that things aren’t as bad as they appear. If the market is able to gather momentum and enter a consolidation that lasts for months, the first half of 2019 might be the start of a long-term recovery. This will be followed by a period of relative stability.

Related

No comments