Home / Business and Economy / Why Is Crypto Still So Volatile Despite Support?
Why Is Crypto Still So Volatile Despite Support?
26 Nov
Summary
- Crypto faces volatility despite industry support and investor influx.
- Economic slowdown and company strategies impact cryptocurrency prices.
- High leverage in crypto bets exacerbates market downturns.
Cryptocurrency, once hailed as the future of finance, is facing significant volatility despite a year of favorable conditions. This past year saw increased mainstream investment, industry-friendly legislation, and presidential support. However, Bitcoin has plummeted 30% from its early October high, a steeper drop than the general stock market.
Actor Ben McKenzie, a vocal critic, recently premiered his documentary "Everyone Is Lying to You for Money," which delves into the market's current meltdown. McKenzie suggests the volatility stems from a decelerating economy, with crypto acting as a barometer for speculative markets. He also points to corporate investment strategies, like MicroStrategy's, and the high leverage employed by investors as key factors contributing to rapid price collapses.
McKenzie views cryptocurrency fundamentally as a scam, countering arguments that long-term investors have still seen gains. The current market conditions, characterized by rapidly increasing numbers and persistent volatility, raise concerns about the stability and future of the crypto industry, especially as companies like MicroStrategy face their own financial challenges.
