The crypto market has been very bad in the first half of this year. Major cryptocurrencies went down by almost 50 percent in all their high-time value compared to last year. Although there have been small surges in the recent few weeks, the cryptocurrency market as a whole has stalled.
While no one is sure about crypto’s future, some experts say cryptocurrencies are expected to drop even further before a sustainable recovery is implemented. But irrespective of what is happening in the crypto market, people’s interest in cryptocurrency is still high. It is a popular topic among investors, college students, and social media.
But with the crypto market cooling, some are worried whether it’s crushing. There is no exact prediction of these volatilities in the long term. This article discusses why is crypto crashing and what can be done for a sustainable recovery in the future.
Regulation of The Cryptocurrency
Following the investors’ concern on why is crypto crashing, the lawmakers in Washington D.C, in collaboration with other lawmakers worldwide, are trying to implement laws and guidelines that make it safer for investors. There are also concerns about how to make cryptocurrencies less appealing to cybercriminals.
Many officials have raised concerns about stablecoins, which experienced a free fall that led them to depeg from the dollar. As a result, the cryptocurrency linked to it was crushed, and several investors could watch their investments vanish in a few days. Following the fall, many cryptocurrency companies announced freeze withdrawals and layoffs to cut costs because of the extreme market situation.
Other companies filed for bankruptcy. Implementing regulations could stabilize the notoriously volatile crypto markets. Due to the crypto market volatility, experts advise investors to keep their crypto investments to less than 5 percent of their portfolio.
Adoption of Broader Institutional Cryptocurrency
After a great concern about why is crypto crashing, many mainstream companies in all industry sectors are taking an interest, and some are investing in blockchain and cryptocurrency. Many reputable payment companies allow users to buy crypto through their platforms, and others accept cryptocurrency as a payment option. However, paying for goods and services in cryptocurrencies may not make sense to many people now.
There are also doubts about whether some retailers accepting crypto payments will change the landscape in the future. And further adoption of crypto by several institutions could also lead to more use cases, impacting crypto prices. However, there is no guaranteed outcome of these measures; but there is a possibility that the demand will rise, particularly if you buy crypto as a long-term store of value.
Summary
The fact that the crypto market is cooling doesn’t necessarily mean it is crushing; lawmakers and institutions have implemented several measures to stabilize the markets of volatile cryptocurrencies.
Some of these measures include implementing government regulations to make the market safer for investors, which include measures to prevent attacks by cybercriminals. There is also an adoption of broader institutional cryptocurrency, where big companies in almost all industries have invested in blockchain and cryptocurrency. Many also accept crypto as a payment option for their goods and services.
Other reputable payment companies are allowing users to buy crypto through their platforms. However, none of these measures have a guaranteed positive outcome. Therefore, putting a small amount of your money into the crypto investment is advisable. Do not put it above other financial goals like paying debts or retirement savings.