Inflation, Downturn and War - Crypto Currency
Co-founder of automated crypto trading platform Coinrule, Oleg Giberstein, thinks crypto is undergoing the same stresses as other parts of the economy, leading to the fall in prices.
He said: “It’s not just crypto that’s down, everything is down, and over the next 6-12 months the economic outlook is bad. Central Banks are between a rock and a hard place with regard to slow economic growth and high inflation. So, investors are escaping ‘risk-on’ assets like crypto and tech stocks.”
As for whether this downturn marks the beginning of a long-term trend or a temporary blip, Giberstein believes the market could remain challenging for up to two years, but added things could worsen during that time.
Sam Kopelman of crypto exchange Luno agreed that Bitcoin and other coins’ misfortunes weren’t happening in isolation: “Falling below $30,000 leaves bitcoin on the precipice of a key support level. If Bitcoin falls below this support level, it could even drop further to $25,000 before any significant move back up.
“Investors dumped assets across the board yesterday as global stocks suffered the worst day since June 2020. The market is battling the consequences of rapidly rising U.S. interest rates, alongside military conflict in Europe.”
Inflation information out last week from the Reserve Bank Of India (RBI) likely had a knock-on effect for interest rates and, in turn, crypto prices.