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The cryptocurrency market has been under intense selloff since Monday. Cryptocurrency traders who had previously said that the market had bottomed were dealt a major shock as markets tanked to levels last seen nearly two years ago. The recent market crash has triggered discussions on Twitter. The community has expressed mixed reactions whereby some are concerned over the passive losses, while some are celebrating buying the dip.
Crypto market crashes
Several factors have triggered the current onslaught including inflation, a possible hike in the interest rates and a looming recession. The final blow was dealt after another fiasco in the decentralized finance (DeFi) sector when the Celsius network announced halting withdrawals.
These factors have led to Bitcoin’s collapse to December 2020 lows. Following the increased selling pressure, some exchanges limited token withdrawals, while several Web3-focused companies announced layoffs. The floor prices of some popular non-fungible tokens (NFTs) have also declined.
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Crypto Twitter reacts to the crash
Crypto Twitter has aired their thoughts about the recent market crash. Seasoned cryptocurrency investors usually advocate for holding their coins. However, the recent selling pressure seems to be adding stress to some holders who had previously vowed never to sell their coins.
The recent crash also seems to be reducing the number of cryptocurrency whales in the market. Whale addresses have lost an enormous amount of their wealth, with companies such as MicroStrategy recording billions of dollars in unrealized losses because of the crash.
Cryptocurrency traders are also showing conflicted opinions on how to react to the crash. In the previous market crashes, seasoned traders advocated for buying during the dip. However, with Bitcoin showing signs of touching $20,000, there are no definite plans of whether to buy, sell, hold or trade in the broader crypto space.
Cryptocurrency analysts usually use technical indicators to inform their decisions. Technical indicators have proven to be very effective in the past. However, the current market performance has made these indicators unreliable. The loss of confidence in these indicators has also makes it impossible to predict where the market is headed.
The cryptocurrency space is not the only asset class suffering from declines. The entire stock market is also down. Investors are selling off their holdings because of the increased monetary tightening by the Federal Reserve. Investors have been selling off their stocks, and indices such as the S&P 500 have declined to new 2022 lows.
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