What is the reason for the fall of the cryptocurrency market?

🆘 The fall of the cryptocurrency market: what is it connected with crypto collapse today?

😱 The crypto market is collapsing, crypto is falling, liquidations in the thousands, panic sentiment and outflow of investments – this is exactly the kind of news that has been observed in the global crypto community lately. Moreover, this affects not only ordinary investors, but also institutional whales, whose activity has decreased after the Bitcoin halving in 2024.

✋ What is the reason for the fall of the crypto market?, what reasons influenced the bearish sentiment in the crypto industry in recent months, and what to do in the current situation – we will figure it out today.

🔷 Crypto market crash as a phenomenon

Crypto market collapse – a sharp and noticeable drop in the price of most coins, including bitcoin, altcoins and meme coins. A collapse can be considered a general decrease in the value of various digital assets by 10% or more within one day. As a result, one can observe increased volatility, which becomes the cause of mass liquidations, as well as panic selling of tokens. The phenomenon is reminiscent of a classic stock market crash.

Changes in sentiment on the crypto market, the political and economic situation in the world, technical problems and the development of fraud also have a negative impact on the situation and can lead to a fall in cryptocurrency rates. But usually, each specific phenomenon of a cryptocurrency market collapse is accompanied by its own unique influencing factors.

👇 Next, we’ll talk more specifically about what is causing the fall in the crypto market in 2024.

✴️ Reasons for the crypto market collapse in 2024

Based on different opinions among analysts today, on the collapse of the cryptocurrency market in August 2024 influenced by the following reasons:

• 🔻Geopolitical tensions and armed conflicts. A situation where people urgently need money leads to sales of assets at low prices, which further collapses the exchange rate, and growing conflicts around the world, in particular the situation in the Middle East, negatively affect purchasing power and active crypto trading.
• 🔻Unstable situation in the economic sector of many leading countries of the world. Yes, the economy of countries, for example, a slowdown in its growth, an increase in the unemployment rate, also has an impact on the crypto market, because when it is in decline, the investment opportunities of citizens fall. The desire to buy high-risk assets like crypto is logically low.
• 🔻Pressure regulators. Lack of understanding of how to regulate the cryptocurrency sector leads to price fluctuations. And if the attitude of regulators is negative towards crypto-assets, then their value, of course, falls. Just look at the epic around the SEC and Ripple, which has already ended, which immediately showed some kind of correction in this coin.
• 🔻Institutional investor activity. The movement of large amounts of Bitcoin, Ethereum and other coins, their withdrawal from exchanges, as well as low interest in replenishing their portfolios, all add to market instability and bearish sentiment. For example, the famous market maker Jump Crypto sold a significant part of its digital assets, which certainly affected the market.
• 🔻Stock market crash in August 2024. The collapse of the global stock market, which began with a fall in Japan, coincided this year with the fall of the crypto market, added panic and played a role in Why happened crypto collapse.
• 🔻Mass sale of coins. This is already a consequence of previous reasons, but it was the massive sales of tokens, primarily Bitcoin and Ethereum, that became, as they say, “the last nail in the lid” for the continuation of the downward vector of cryptocurrency rates.

🌂 All these factors led to a liquidity shortage in the cryptocurrency market in 2024. And, as is known from the laws of economics, when there are difficulties with the availability of demand and the purchasing power of investors, the price of assets decreases.

🔰 When will the cryptocurrency market crash end in 2024?

Making forecasts about the end of the fall of the crypto market in 2024 is a thankless task. After all, just as many factors contributed to its collapse, so many of them will cause its recovery. In addition, we must not forget about the volatility of the cryptocurrency market, which can lead to abrupt price changes.

In any case, it is the change in the reasons described above that will play a role in the correction and bullish sentiment in the market.

Regardless of whether the current crypto market crash is long-term or short-lived, investors should pay attention to traditional market signals:

• 🔺General sentiments of the crypto community. It is worth tracking the greed and fear indices, thanks to which you can notice changes in market sentiment, investor confidence in digital assets and their purchasing power.
• 🔺World news. Any positive events in the political and economic components can become an impetus for an increase in the price of Bitcoin and altcoins. We must not forget about meme coins, the price of which is influenced by PR and good advertising, as a result, the interest of investors.
• 🔺Regulatory framework. The influence of regulators on the crypto industry is worth monitoring and, if the attitude is favorable, expect an increase in prices on the crypto market.
• 🔺Innovation and technological development. Noticing timely announcements of certain innovative implementations in the crypto industry allows us to better understand where the price of digital coins will move.

📈📉 Fundamental and technical analysis of tokens should not be written off. By identifying reversal patterns, as well as understanding trends and being able to read patterns on charts, you can better understand when the crypto market crash will end in 2024.

🗣️ Real mOpinions of crypto experts about the fall of the cryptocurrency market in August 2024

Many well-known and respected crypto industry analysts have spoken out about the 2024 crypto market crash.

OKX Exchange Director Lennix Lai noted the impact of a positive signal in slowing inflation in the United States, as well as the completion of the payment saga of the bankrupt exchange Mt.Gox. All this, according to the expert, should set the market up for an optimistic scenario.

Another analyst, Alexander Peresichan, who is also the CEO of TEHNOBIT, expressed the opinion that until the fall, pressure on the crypto rate will continue due to the impossibility of lowering the key inflation rate in the United States.

Manager of VG GROUP holding Vagiz Nurullov was specific. He noted that the third quarter of 2024 is expected to be at the bottom of the crypto market, but at the end of this year we will see a rally.

Well-known analyst Viktor Pershikov believes that it is still worth waiting for optimism in the crypto market this year. This should be especially influenced by the active actions of world countries to avoid a global crisis. The key to all this, according to Pershikov, is the level to which the digital asset market will have time to fall before it begins to recover and grow.

💹 In general, the sentiment among analysts is ambiguous and, judging by them, a full recovery of the crypto market should be expected in the fall, towards the end of this year.

💡 How to deal with the fall of the crypto market today?

As in any other situation, a crypto investor should always have a clear strategy in the market. And this is especially true during bearish sentiment.

In the current situation, when the crypto market collapsed, it is best to adhere to the following settings:

• ✅Peace of mind. It is extremely important not to make panic sales at a loss. You should approach any actions in the market with a cool head, without giving in to emotions.
• ✅Analysis. It is necessary to conduct comprehensive research, analyzing every aspect that influences the fall of the cryptocurrency market and its recovery. It is also important to be able to see the big picture.
• ✅HODL. Buy and hold is an excellent strategy for potentially profitable cryptocurrencies. This is one of the most effective methods of action in case of a crypto market collapse, because it allows you to purchase at a cheap price for the long term and sell the coin over time with a good profit.
• ✅Diversification. Spreading your investments across different coins in your portfolio can be great for reducing your risk of losing money. This is especially true in a situation like now, when the market is in decline.

📌 It is important to be realistic when investing during a crypto market collapse. It is imperative to take into account volatility and its difficult predictability during such periods. It is best to invest funds that you can risk. Also, do not ignore stop loss levels.

🤑 It wouldn’t hurt to study more Top cryptocurrencies for investment from our editors.

❔ Is it worth buying crypto now?

Despite the current decline in the cryptocurrency market, the digital asset industry itself is still resilient and has enormous potential. The crypto market itself does not stop its development. So its collapse can be seen as a good opportunity to select promising coins and buy them for the long term. Although intraday trading can now become successful for someone, given the increased volatility of Bitcoin and many altcoins.

📥 Before making any decision to invest in the crypto market, it is worth analyzing the latest news and all changes in the cryptocurrency segment for today. It is important that the decision to purchase a coin is based on your personal financial situation and a careful assessment of current trends.

🤹‍♂️ Need help?

The collapse of the crypto market can be discouraging, but at the same time, it is a unique opportunity for all investors who are well informed and prepared.

If you feel that you are not sufficiently informed and prepared to make informed decisions and build a profitable strategy during the current decline in the cryptocurrency market, contact our specialists for help. Get professional support and confidence ahead of the inevitable cryptocurrency rally.