Why did mainstream cryptocurrencies suddenly fall (Can mainstream cryptocurrencies rise after a big fall)?

The sudden fall of mainstream cryptocurrencies, why did they suddenly drop after Bitcoin broke through its all-time high? Why did mainstream cryptocurrencies suddenly fall?

around 4 pm today, the market began to experience a significant pullback, with the current lowest price reaching $7,150. According to Huobi’s data, BTC has been in an oscillating upward trend since 8 pm last night, until around 9 am this morning when it began to rebound. However, due to market panic and high volatility, prices experienced sharp ups and downs, resulting in a slight decline. As of the time of writing, prices have already reached around $7,000.

This decline is influenced by recent negative news, and other mainstream cryptocurrencies have also been affected to varying degrees, such as ETH, BCH, and other currencies (e.g.: XRP and LTC). However, in reality, these drastic increases are mainly driven by certain news that often catches market attention. Of course, some people believe that this significant surge is due to news of the US Treasury investigating cryptocurrency exchange Bitfinex. Additionally, there are concerns that U.S. Treasury Secretary Yellen may make further statements regarding the regulation of digital assets… So why did mainstream cryptocurrencies suddenly fall?

1. Ethereum’s value has not been overestimated. 2. The “Bitcoin halving” concept seems to be crucial for blockchain technology, so it is generally expected to occur in 2021.

2. Increase in Grayscale fund holdings.

3. MicroStrategy purchases $100 million worth of BTC as its primary reserve asset, and expresses the intention to continue buying and holding more BTC.

4. The correlation between Bitcoin and gold has reached a new low.

5. Over the past year, an increasing number of institutional investors have entered this field, and investment institutions are also considering increasing their holdings of Bitcoin. Additionally, a recent series of events and various factors have prompted many traditional financial companies to follow suit. Especially in the days following the release of Facebook’s Libra whitepaper, many central banks of various countries have been actively studying the possibility of issuing Central Bank Digital Currencies (CBDCs).

Can mainstream cryptocurrencies rise after a sharp fall?

After experiencing a sharp decline in the past two days, mainstream cryptocurrencies have started to rebound once again. According to OKEx data, as of November 19th’s closing, BTC is priced at $9,370, a nearly 10% drop from the previous highest point; ETH is priced at $187.5, a 14.4% increase from yesterday; XRP is temporarily priced at $0.278, an 11.7% increase from yesterday; BCH is temporarily priced at $318.5 (-3.63%), and BSV is temporarily priced at $247.7, remaining flat compared to the opening price today.

Looking at historical data, there hasn’t been significant market volatility for over two and a half years. However, with the continued decline in the prices of Bitcoin and Ethereum since the beginning of this year, some investors have shifted their funds into altcoins for arbitrage, leading to another significant drop in prices. So, can mainstream cryptocurrencies still rise after a big fall? Let’s review the recent market trends together. 1. Spot market trading conditions.

Since BTC initiated a new round of strong rally in June, Bitcoin, Ethereum, and other mainstream cryptocurrencies have experienced a wave of price recovery. According to CoinMarketCap data, the total market capitalization of cryptocurrencies in the first half of 2019 reached a peak of $5.91 trillion, with USDT accounting for approximately 15.78% of the total issuance. During 2020, the total market capitalization of Bitcoin only reached $4.68 trillion, accounting for over 70%. Among other assets, LTC and EOS ranked first, third, and fourth, respectively. Both tokens achieved certain results in this bull and bear cycle, but before the last bear market turned positive, their performance was not as hot as predicted. (Log in to the app — Discover, to check more exclusive reviews of other cryptocurrencies).

2. Recovery path after a major drop in mainstream cryptocurrencies.

During this recent period, major cryptocurrencies like Bitcoin have seen good returns, including BNB, HT, OKB, XLM, ZEC, and many other mainstream cryptocurrencies that haven’t even been listed on a small exchange. The reason why these tokens can maintain a high premium is largely due to the innovative design of their underlying technological architecture, making them attractive. Additionally, their decentralized nature and high entry barriers have gained recognition from many people, leading to their prices being accepted by many even in the current phase with significant market bubbles. Therefore, when mainstream cryptocurrencies suddenly experience large-scale selling, it can be considered as good news. 3. Short-term market trend analysis.

Yesterday evening, the three major U.S. stock indexes collectively plummeted, with Dow Jones futures falling more than 3% to 11,200 points in the short term, and the Nasdaq being heavily affected by the largest weekly circuit breaker since late October last year. At the same time, the U.S. stock market suffered another heavy blow. In the global financial market, gold, as one of the most popular commodities, continues to break through resistance lines and further compress bottom support.