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Many factors are influencing the current state of the crypto market. In this blog post, we explore some of the key reasons why the market is going down today.
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Reasons for the Market Crash
The Bitcoin Fork
A Bitcoin fork is when the blockchain splits into two different paths. Forks can happen when developers don’t agree on how to upgrade the software, or they can be created deliberately in order to offer an alternative version of the currency. The most famous example of a fork is Bitcoin Cash, which was created in August 2017.
When a fork occurs, all holders of the original currency are also holders of the new currency. This means that if you owned Bitcoin before the fork occurred, you would also own an equal amount of Bitcoin Cash. Forks can have a big impact on the market, as they can create uncertainty and result in price fluctuations.
The recent Bitcoin fork is one of the main reasons for the current market crash. The fork caused a lot of uncertainty and speculation, which led to a sell-off in both Bitcoin and other cryptocurrencies. The market is still trying to recover from this event, and it may take some time before we see any sustained recovery.
Chinese ICO Regulations
The initial coin offering (ICO) craze, which has seen numerous blockchain projects raise millions of dollars in a matter of minutes, appears to be cooling off. One of the primary reasons for this is the crackdown on ICOs by Chinese regulators.
Last week, the People’s Bank of China (PBoC) declared that ICOs are illegal and issued a notice that called for the “cease and desist” of all related fundraising activities. This news sent shockwaves through the cryptocurrency community, as China has been one of the most active markets for ICOs.
In the wake of the PBoC’s announcement, many Chinese blockchain startups have either cancelled their ICO plans or put them on hold indefinitely. Others have shifted their focus to overseas markets, where ICO regulations are not as stringent.
The overall effect of this has been a dramatic slowdown in the pace of ICO fundraising. In the first half of September, ICOs raised a total of $ 1.1 billion, which is less than half of the $ 2.4 billion raised in August. It is also worth noting that September’s total is lower than any month since March, when ICO fundraising was first gaining momentum.
The decrease in ICO activity comes as no surprise given the recent regulatory crackdown in China. However, it remains to be seen how long this slowdown will last and what impact it will have on the cryptocurrency market in the long run.
Bitcoin ETF Rejections
The most likely reason for the market crash is the recent news of the SEC rejecting multiple Bitcoin ETFs. An ETF, or Exchange Traded Fund, is a fund that tracks the price of an asset, such as gold or oil, and can be traded on major stock exchanges. Bitcoin ETFs would allow investors to buy into Bitcoin without having to actually own any of the currency, making it much easier to invest in Bitcoin.
The SEC has rejected numerous Bitcoin ETFs in the past, but the most recent rejections were seen as particularly crushing for the market because they came after months of anticipation. The SEC cited concerns about manipulation and fraud in the Bitcoin market as their reason for rejecting the ETFs, and this news has caused many investors to lose faith in cryptocurrencies.
How to React to the Market Crash
When the market is going down, there are a few things you can do. You can watch from the sidelines and wait for it to come back up. You can sell all your assets and get out while you can. Or, you can buy more assets while they’re cheap.
Don’t Panic Sell
If you own any crypto, the recent market crash may have you feeling a little uneasy. You’re not alone. In the past 24 hours, the crypto markets have lost over $600 billion in value. So, what’s going on? And more importantly, what should you do?
First of all, it’s important not to panic sell. When the markets are in free fall like this, it’s tempting to sell everything and get out while you can. But that’s usually not a good idea. selling when the market is down means selling low and buying high, which is the exact opposite of what you want to do.
What’s more, if you sell now and the market recover, you’ll miss out on that upside. Of course, there’s no guarantee that the market will rebound and no one can predict the future with 100% certainty. But if you believe in crypto long-term, it’s usually best to ride out the downturns and trust that things will eventually recover.
Of course, everyone’s situation is different and there’s no one-size-fits-all solution here. If you’re worried about your portfolio getting wiped out or if you need the money for other purposes, then selling may be the right move for you. Just make sure you do it thoughtfully and don’t let emotions dictate your decisions.
Do Your Own Research
When it comes to the cryptocurrency market, there are a lot of opinions flying around. It can be hard to know what to believe, and even harder to figure out what you should do next. The best thing you can do in a situation like this is to take a step back and do your own research.
That doesn’t mean that you should put your blinders on and ignore what’s happening in the market. But it does mean that you should be careful about taking any one person’s word as gospel. There are a lot of people out there with a vested interest in getting you to buy or sell cryptocurrencies, and not all of them have your best interests at heart.
If you want to get a sense of where the market is really at, look at a variety of sources before making any decisions. Here are a few places you can start:
-Cryptocurrency news websites: These websites can be a helpful way to stay up-to-date on what’s happening in the market. Just be sure to take everything you read with a grain of salt, and remember that these websites are often trying to generate clicks and ad revenue, so they may not be entirely impartial.
-Reddit: Reddit can be a great place to get unbiased information about cryptocurrency. There are numerous subreddit communities dedicated to different coins and topics, so you can usually find an informative discussion no matter what your interests are.
-Twitter: Twitter is another good place to find real-time information about the cryptocurrency market. Be careful, though—it’s easy to get lost down the Twitter rabbit hole, and it can be easy to mistake someone’s opinion for fact.
Doing your own research doesn’t mean that you have to go it alone. Talk to other investors, join online forums, and attend meetups in person if possible. The more people you talk to, the better informed you’ll be—and the more likely you are to make smart decisions about your investments.
Stay Up-To-Date on News and Announcements
There are a lot of moving parts in the crypto world, and it can be tough to keep track of everything. That’s why it’s important to stay up-to-date on the latest news and announcements. This way, you’ll have a better sense of what’s going on and why the market is fluctuating.
There are a few different ways you can stay up-to-date. One is to follow crypto news outlets like CoinDesk or Bitcoin Magazine. You can also join online communities like Reddit’s r/CryptoCurrency. And finally, you can sign up for newsletters from exchanges or other companies in the space.
By staying informed, you’ll be better equipped to weather the ups and downs of the market. And who knows, you might even find some opportunities to buy low and sell high!
What’s Next for the Crypto Market?
After a few months of steady growth, the crypto market has taken a hit in the last few days. The market is down today, but what does that mean for the future of cryptocurrency?
The Bitcoin Fork
On August 1, a new cryptocurrency called Bitcoin Cash began trading at around $600. It was created as a result of what’s called a “hard fork” from the main bitcoin blockchain.
For those who don’t know, the blockchain is the public ledger of all bitcoin transactions. It’s what allows the whole system to work without a central authority like a bank. Bitcoin Cash is basically a clone of the main bitcoin blockchain with a few important changes.
One of those changes is that Bitcoin Cash has an 8MB block size, whereas Bitcoin has a 1MB block size. That means that Bitcoin Cash can theoretically process 8 times more transactions than Bitcoin. This is important because one of the big problems with Bitcoin right now is that there are too many transactions and not enough capacity to process them all quickly. This often leads to long delays in processing transactions, and sometimes even causes transactions to be completely dropped.
The other change is that Bitcoin Cash will use a different algorithm for confirming transactions. This is called “Proof-of-Work” (PoW). PoW is the same algorithm that’s used by Ethereum and other cryptocurrencies. It’s different from the algorithm that’s used by Bitcoin, which is called “Proof-of-Stake” (PoS).
The change to PoW is meant to make Bitcoin Cash more resistant to attacks from people who want to subvert the system. PoW requires more computing power than PoS, so it’s more expensive to try to attack the network.
So, what does all this mean for the crypto market? Well, it’s hard to say for sure. The fork has caused quite a lot of confusion and there are still a lot of unknowns. However, one thing seems certain: the fork is having a negative impact on the price of bitcoin.
At the time of writing, bitcoin is down about 5% from its pre-fork price of around $2,700. It’s possible that the price could continue to fall in the short-term as people sort out what’s going on and figure out which version of bitcoin they want to invest in. However, in the long-term, this could be good for bitcoin because it will increase capacity and make it more resistant to attacks.
Chinese ICO Regulations
The price of Bitcoin and other major cryptocurrencies has taken a hit today after China’s central bank announced new regulations on initial coin offerings (ICOs).
In a statement, the People’s Bank of China (PBOC) said that it had completed a month-long inspection of ICOs and had found that many of them were in violation of Chinese law. The PBOC said that it would crack down on illegal ICOs and would work to protect investors.
This is not the first time that the Chinese government has taken action against the cryptocurrency market. In September, China banned ICOs and exchanges from operating in the country. This latest announcement is likely to add to the bearish sentiment in the market.
Bitcoin ETF Rejections
The U.S. Securities and Exchange Commission (SEC) has rejected another round of Bitcoin exchange-traded fund (ETF) proposals, dealing a major blow to the crypto community’s hopes of seeing a BTC ETF listed on a major U.S. stock exchange in the near future.
In a statement released on August 22, 2018, the SEC announced that it had disapproval orders for nine separate Bitcoin ETF proposals that had been submitted by three different firms – ProShares, Direxion, and GraniteShares – all of which are registered investment companies with the SEC.
The SEC’s decision to reject these latest Bitcoin ETF proposals comes as no surprise to many in the crypto community, as the commission has consistently shot down similar proposals in the past. Most notably, the SEC rejected the highly anticipated Winklevoss Bitcoin Trust ETF in July 2018, citing concerns about market manipulation and fraud.
The crypto community had hoped that this most recent round of Bitcoin ETF proposals would be approved by the SEC, as they addressed many of the concerns that had previously been raised by the commission. However, it appears that the SEC is still not ready to give its blessing to a BTC ETF.
In its decision to reject the latest Bitcoin ETF proposals, the SEC cited concerns about market manipulation and lack of regulatory oversight as two of the main reasons for its decision. The commission also stated that it is “unable to find” any Exchange Traded Product (ETP) listing venue – such as a national stock exchange – that would be willing to provide adequate surveillance and safeguards against market manipulation for a BTC ETF.
This news is sure to come as a major disappointment to those in the crypto community who have been eagerly awaiting a Bitcoin ETF, as it would likely lead to increased institutional investment in BTC and help pave the way for mainstream adoption of cryptocurrency products and services.
