Explained!
The cryptocurrency market experienced its second meltdown in a month. Bitcoin is currently trading in the red, as are Ether and many other cryptocurrencies. But what caused this crash, and is there any long-term hope for investors?
But what has triggered the latest sell-off?
The graph has fallen in line with the sell-off in US stock markets caused by higher-than-expected inflation and concerns about aggressive interest rate hikes by the US Federal Reserve. Although the cryptocurrency market operates independently, it remains highly sensitive to the mainstream financial sector.
The Red Mark crypto crash:
The red-crash, which has wiped out $40 billion in investor funds, has jolted the system, as many experts have stated that stable coins are not as prone to wild fluctuations as other cryptos right now.
Let’s understand what Celsius is and will its ban on withdrawals matter?
Celsius is a crypto lender, which essentially means it is a cryptocurrency bank.
Customers can deposit their coins with crypto lenders in exchange for interest and then lend them out to earn a return.
In terms of numbers, Celsius is currently a major player in crypto lending, holding approximately $11.8 billion.
Let’s square in. How bad is the crisis?
For the first time since 2021, the crypto market’s value fell below $1 trillion during its most recent crash. Bitcoin is down nearly 70%, and Ether, the second most valuable token, is down 75%.
With all of these reports, it is clear that the overall focus is on negative risk sentiment, and a turn around appears unlikely.
