Crypto Academy Contest / S1W4 – Reviewing the Instability of the Crypto Market by @rad-austine

Introduction:

Hello friends greetings to you all, how are you people doing, i hope you all are doing fine, i am so, glad once again to be here today, in this wonderful community, to participate in this unique contest.

As we all know the contest has been a nice one, engaging with different steemians all over the globe, and the title of the contest is a fascinating one because it has to do with what is happening in the crypto-market, most cryptocurrencies have been facing some deline especially last week, which has made a lot of investors to lose fund. The above image was edited my me using flyer marker.

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Most of the cryptocurrency market is currently experiencing a sharp decline, especially in recent days. What do you think of this drop? State its causes and how long do you think it will continue in this downtrend?

The decline in the drop of cryptocurrency, has affected most investors, especially big investors that invested millions of naira or dollars in to cryptocurrency, it has made investors to lost half of their investment in to cryptocurrency, and if the decline continue, most investors, will have no choice but to withdraw their remaining funds.

Because there is a saying, half bread is better than none, meaning getting half of their investment is better than loosing all, and when that happens, the crypto-market will no longer be secure again.

For investment, which will make new investors to be afraid of investing in cryptocurrency, and other smaller investors will run away from putting their money into what will not be favorable to them because their fund will not be secure anymore.

Besides investment is just like business, all crypto-investors, their main reasons of putting their fund, in to cryptocurrency is to make profit, so when the profit is no longer coming they tend to run away.

The cause why some cryptocurrency are experiencing this decline to my understanding are as follows:

Demand and supply

Cryptocurrency is just like other form of commodities in really life, so when the demand is high the price will rise, and when the supply is low the price will reduce, so i believe the supply is low, causing a drop down in the price of crypto.

Besides most of the big investors are withdrawing their fund because of the decline, they're scared of loosing everything, so the selling rate is now far higher than the buying rate that is one of the reason for the decline in the price of crypto.

Volatility of cryptocurrency

Volatility is just like a characteristics feature of cryptocurrency, all cryptocurrency behave in a volatile ways, their price is not always stable, that is why spot trading in Binance has been favorable to me, i take the advantage of the volatile behavior of cryptocurrency, either to buy when the price is low and sell when the price is high.

As a crypto-users it's take patience and endurance to succeed in crypto-business, also cryptocurreny is not like fiat currency that have a regulating body to keep it price constant, a coin might rise high in the morning before evening it will fall very low, so all crypto-token don't have a stable or constant price, always fluctuating.

That is why it's advisable to always invest what you can afford to loose as a crypto-investors is not good to use bill or rent money for investment, so that there will be no disturbance about returning of fund.

So to the best of my knowledge the main reason why most cryptocurrencies are experiencing a decline is because of their volatile nature, always rising and falling in their various prices.

how long do you think it will continue in this downtrend?

The downtrend will not last long if the demand of cryptocurrency increases, if more investors invest huge capital in to cryptocurrency, by so doing the price of crypto will rise, most coin or token will become so valuable, again but from the looks of the trading market the cryptocurrency is still not stable in their prices so it will take the whole of this month may which is just like one month instability.

when the demand for cryptocurrency increase, the current downtrend of cryptocurrency will end, also from the view of most exchange wallet, i observe that, most coin are recovering gradually, cryptocurrency will one experience the downtrend one in this month of May, so by next month June, all crypto-price will skyrock, to a very high limit.

Why doesn't this drop in the price of a few coins decrease their trading volume (eg: Bitcoin)? How will they deal with this market instability?

The reason why the drop in the price of few coin do not affect their trading volume are.

Now that the price is low is the best time to buy most coin because some of these, token have, lost half of their value, it's affordable now that their prices is low, an investor can easily get it in large quantities with small capital,
so that when the price rise they will sell it to make profit.

Bitcoin trading volume is high because investors see Bitcoin as a coin that have potential, investors rarely lost all their fund, also Bitcoin trading volume is high because it's a coin that have future potential, it will still rise despite it decline in price.

Most trader trade Bitcoin more than other coin, the trading volume of bitcoin seems to be high because new investors are now moving in to the market to buy coin at a cheaper rate because of it's decline, the decline is of an advantage to smart investors.

How will they deal with this market instability?

Most traders are optimistic that the price will rise, since volatility of cryptocurrency is part of it's features, so traders are always having positive thoughts that the decline will only last for a short period of time.

So as a trader it's good to away look at the bright side, that when the coin rise they will make profit again, that is the reason why the trading volume of cryptocurrency is still high.

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What is the relationship between the current instability and the downfall of the Terra ecosystem and its Luna currency?

Do you think its price will bounce back? If so, tell us how and when?

Last week Thursday, was a serious crash in the crypto-market wiping out billions of dollars been invited, by big investors, the terra Luna was among the top ranking, cryptocurrency.

Terra Luna and the USTD created by terraform lab use an algorithmic stable coin a complex mix of code and Luna stabilize the process, an it was pegged to $1 the terra ustd was peg to us dollars, so that it will not be volatile so USTD was removed from it's sister token Luna that was the main reason for the crash also other platform were been built on the terra Luna ecosystem

Do you think its price will bounce back? If so, tell us how and when?

Am very optimistic that the price of terra Luna will bounce back with my follow reasons:

Terra Luna was delisted by Binance and most exchange because it's losses 99% of it's value, but since Binance and other exchanges have accepted it, in their exchange platform, which is a good reason that the coin will rise again, because it's no longer delisted, traders or investors can easily buy it's again.

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Our Steem ecosystem, like most currencies, has been affected by this market downturn, has this caused you as a user some stress?

Or are you still confident in this project? Give your opinion, specifying the arguments that support your review.

As a crypto-users it's always advisable to be optimistic, because investing in cryptocurrency, seems to be risky because all the crypto-token are volatile, but to me it creates some positive impact in the sense that i used the advantage of most of the decline coin to buy some for my self at cheaper rate. so it's an opportunity to acquire some Steem and other coin at a cheaper rate.

Am still very confident in the project, because it's not the first time the crypto-ecosystem is experiencing such a downturn, I could remembered when Bitcoin as the leading coin was created and introduce in 2009, it's also face a series of volatility before it's rise to million dollars today

Then Bitcoin had no value in 2009, also in 2010 bitcoin price was $0.09 dollar, further more, bitcoin was experiencing rise and fall, then in 2011 bitcoin price jump from $1 to $296, finally 2020 bitcoin price reached about $40000 a very huge amount of money, so investors made a lot of profit. I am still confident that all the coin will recover an rise again.

Am so optimistic that the price of Steem will rise again since it's the nature of all coin to behave in a volatile ways, so am also confident that the steemit ecosystem will grow again, the current situation will soon fade away an all steemians will be glad in the improvement especially in the price of Steem.

Conclusion:

I sincerely thank the steemit Crypto-academy for organizing this contest.
Best regards goes to steemit crypto-professor @kouba01

I invite @olabillions and @josepha to come and participate in this contest.

Thank you all for viewing my post