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why the cryptocurrency market has sharply declined

DATE OF PUBLICATION: 2021-02-23 16: 44: 04The last few weeks have passed under the auspices of numerous value records that bitcoin has set. The cryptocurrency market has been positive about the constant growth of the main digital asset. And now, after Bitcoin crossed the $ 58 thousand mark, the market stopped responding and began to decline. This dissonance was the signal for an impending market correction. Over the past three days, bitcoin dropped to $ 46 thousand, which was a huge jump down and negatively affected the cryptocurrency market. As of 15:00 on February 23, the main coins began to recover their positions, but in the morning the market slipped by almost 25%. The XRP token fell to $ 0.4 and only in the afternoon began to creep upward with minor drawdowns. Ethereum fell to $ 1400 and only in the last few hours began to recover its positions and consolidated at $ 1535. Now the coin is restoring its positions and creeping up, having fixed at $ 1520. Litecoin stopped at $ 166 and after a slight increase to $ 175, slipped back to its previous indicators. Now the coin is trying to gain a foothold in the safe interval between $ 170 and $ 175.Despite the fact that most forecasters expected a price correction in early spring, the question arises: what caused the market drawdown and liquidation of the record volume of positions on crypto exchanges on February 23. The answer is simple: the deteriorating position of bitcoin influenced the price correction that crashed the market. The final spurt of the first cryptocurrency has already taken place under unfavorable circumstances: problems with the stablecoin Tether and frank criticism of the coin from Elon Musk, JPMorgan experts and the US Treasury Secretary. Against the background of unpleasant news, Bitcoin could not gain a foothold in safe positions and collapsed by $ 10 thousand, and the past day dropped by 12%. The main drawback of the cryptocurrency – high volatility – played negatively on the coin’s quotes when it tried to settle at the level of $ 55 thousand. In addition to all this, signs of an impending correction have been hovering over the digital asset market for about a week: the market collapsed several times in three days, the main altcoins did not show significant growth with good Bitcoin positions. All this, on top of the dependence of cryptocurrencies on bitcoin, provoked a sharper than expected market decline, while the cryptocurrency market sank by 25% was possible due to the coincidence of two factors: the unhealthy growth of bitcoin in a negative economic situation and the brewing market correction. The jump cost traders more than $ 4 billion, but there are no fundamental reasons for the price correction, which in the future would negatively affect the development of the market. This happened, rather, for technical reasons and a specific economic situation, which contributed to the decline in quotes for major digital assets. Material provided by InstaForex – Source – InstaForex

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