Crypto Stays Calm Amid Increasing Market Volatility: Analysts Weigh In
• Crypto experienced a small dip in early February after weeks of its main assets increasing.
• Analysts noticed that volatility across the board was high, while crypto was only experiencing marginal volatility.
• 2022 saw the worst year on record for crypto with the asset losing more than 70 percent of its value before stabilizing slightly in late 2022.
Crypto Experiences Sudden Lack of Volatility
The crypto space experienced a slight dip in early February after weeks of its main assets riding a bull wave and increasing their prices. However, what analysts were quick to point out is that right now, volatility across the board for things like stocks is rather high compared to the marginal volatility seen in crypto.
2021 Cryptocurrency Market Crash
The digital currency arena faced a major setback in 2021 when bitcoin lost more than 70 percent of its value, falling from an all-time high of about $68,000 per unit down to mid-$16K range by year’s end. This caused the industry to lose over $2 trillion dollars in valuation within 12 months due to speculation, bankruptcies and bad behavior from players like FTX.
Edward Moya Analysis
Edward Moya – senior analyst at OANDA – commented on this situation stating: “It is rather shocking to see how little crypto is moving considering all the volatility across fixed income, stocks, FX and commodities.“ He also mentioned that with yields likely to continue rising, bitcoin might struggle taking out [the] $25,000 level over the short-term.
Tech Dev Analysis
Tech Dev – another well known analyst often sharing his thoughts on Twitter – brought up an interesting point saying when liquidity flows bitcoin moves and five out of last five times there was major BTC impulse followed. He asked his 400k+ followers what could happen this time?
Stabilization In Late 2022
While 2021 saw heavy losses for bitcoin and other cryptocurrencies it appears that late 2022 saw some stabilization as sentiment remained strong enough to keep industry stable despite continued rate hikes threatening potential further dips in price.