It’s been a week since Bitcoin is back in its $19,000 price range, as the currency could not hold on to the $20,000 price range for long. Now, It’s the fifth time that the flagship currency has dropped this low, yet there is no sign of recovery.
The global crypto scenario doesn’t look promising either, and it appears that these hostile conditions could continue for the rest of the year.
However, people are perplexed- What has caused the thriving crypto sector to fall so badly? Read on.
- Economic Crisis
Though the economic crisis is now a global issue, Sri Lanka’s situation has gone out of control.
Sri Lanka’s President, Gotabaya Rajapaksha, has run away from the country with his family to the Maldives. Residents have now marched into the presidential residence. At the moment, Sri Lanka is in a state of emergency.
Even Pakistan is close to entering an emergency state. China is being hit with a liquidity shutdown, and the overall economic development of the world has been hampered.
This is expected to have a similar impact on other developing countries, pulling down the market further.
2. Euro Loses Value Against Dollar
No matter how mighty the dollar was, it wasn’t equivalent to the Euro. However, that’s not the case anymore as the US dollar is now equivalent to the Euro, a scenario which was never seen in 20 years.
This is because US inflation has risen to 9.1%, whereas European inflation is positioned at 6.1%
3. Surge In Inflation Rate
Inflation figures in developed countries like the US, Canada, European countries and Australia are rising. Developing countries like India, China, and Pakistan, among others, are also seeing a leg up.
Along with these, the purchasing power is indicating a negative trend. All these factors are pointing towards a bear market sentiment.
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Source: https://coinpedia.org/news/the-global-markets-are-burning-crypto-to-see-more-downfall/