I'm sure you are all painfully aware that Crypto prices have been in free-fall over the last day. Virtually everything is in the red. Bitcoin itself has dropped from about $14,300 to as low as $10,900 in the course of a mere 24 hours.
Like me, many of you have probably been wondering what is going on. Should you sell or should you hold? Well, I've done a bit of research this morning, and I think I've come up with the reason why this is happening.
If you look at the historical charts, you will see that the Crypto market experiences a similar crash every year around this time. Why is that? Well, we are currently about three weeks from the start of the Chinese New Year, also known as the Lunar New Year or Spring Festival. Believe it or not this is the largest holiday celebrated across the world by number of participants. The Chinese New Year is their Christmas, Thanksgiving, and New Year's all wrapped into one.
With the approaching New Year, Asian investors are pulling fiat out of the market en masse to cover travel expenses, gifts, etc. Never fear, though, this money will start returning to the market once the festivities have concluded.
So what's the best way to deal with the current market condition? Obviously, if I had been more experienced in the Crypto market, I would have seen this coming and moved my cryptocurrency into Tether, and then increase my positions in the coins I love by buying them up at the much cheaper price. This didn't happen... So now I'm left holding a bag of coins that are valued at almost half of what they were this time last week. I'm a firm believer in the concept that you haven't lost anything until you sell. This is where it is important to have a strong hand. I intend to weather the storm knowing that all the coins I'm holding are solid projects, and their value will return. In the meantime, I'm looking at this as a massive buying opportunity. My fiat will purchase quite a bit more this morning then it would have yesterday. This is the time for the Western markets to 'double down'.
In closing, I hope that this has helped shed some light on what is happening in the markets this morning, and has given you the insight needed to hold strong in this storm. If you've been on the fence about whether to make the plunge into Crypto, don't let this 'crash' scare you away, Millionaires are made by buying cheap and selling high.
If you are a newcomer to the Crypto space and need help getting started, please see these two previous blog posts.
https://steemit.com/bitcoin/@beastley/what-is-bitcoin-explained-so-even-your-parents-can-understand-it
https://steemit.com/bitcoin/@beastley/how-to-trade-digital-currency
I am not a financial advisor. This article is intended for educational purposes only. This is a highly volitile market. Never invest something you can't afford to lose.
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