The crypto market is super volatile right now, with Bitcoin dropping below $54K and other major coins also taking a hit. This has put many traders in 'fear mode,' as shown by the Fear and Greed Index. As of July 5th, the index stands at 29:
But why is this happening? Here are our thoughts:
- BTC Inflow to Exchanges: The German government recently moved 1300 BTC (worth $75.53 million) to CEXs, marking a significant Bitcoin transfer to centralized exchanges.
- Market Corrections: Experts say a 28% correction from Bitcoin's all-time high of around $78K is normal, considering the strong uptrend.
- Mt. Gox Payouts: Mt. Gox moved over 47,000 BTC to prepare for repaying $9 billion in Bitcoin to creditors affected by a hack over a decade ago.
- Bitcoin Hashrate Drop: Bitcoin's network power has fallen to levels not seen since December 2022, with a current drawdown of -7.6%, suggesting a possible price bottom.
- Miner Selling Pressure: Since June, miners have sold over 30,000 BTC (about $2 billion) due to post-halving costs. Miner BTC holdings are at their lowest in 14 years, with total reserves dropping by 50,000 BTC this year.
What to do in this situation? Well, there are some strategies:
- If you’re looking to cut losses or take a break from the market, selling your crypto for fiat might be a smart move.
- Swapping volatile cryptocurrencies like Bitcoin and meme coins for stablecoins (like USDT or USDC) can safeguard your assets from further dips.
- Market dips can be golden opportunities for long-term investors. Buying crypto at lower prices now could lead to big gains when the market bounces back.
To minimize risks and maximize your savings, use ChangeNOW to buy, sell, and exchange crypto securely, quickly, and with no hidden fees! Learn how to exchange BTC with the lowest fees in our latest article:
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Drop your strategies in the comments: are you buying or selling in this market? We can’t wait to hear your game plan!
Remember: NOT financial advice! All the decisions you make should be based on your own research.
