Crypto Markets Remain Stable Amid US Stock Market Decline
Will Institutional Investors Finally Join The Crypto World?
A review of American stock markets shows that the small gains made this year have all been erased in the wake of a massive sell-off. However, the crash did not affect the cryptocurrency market. There is an indication of inverse correlation.
The crash might be a result of the ongoing trade tussle between the US and China. Additionally, the hike in Fed rates might be responsible for the temporary crash witnessed in the US.
According to analysts, the Asian sector is more susceptible to crashes compared to the US. This has been highlighted by the slow rate of China’s economic growth. Data released last week indicates that in the third quarter of 2018, the growth rate was at 6.5% which fell short of expectations.
Cryptos like bitcoin and ethereum have a number of factors that influence their prices, unlike other markets. Prices of cryptocurrencies are known to vary frequently. Just like gold, the crypto market only relies on supply and demand within the market.
On the other side, the cryptocurrency market can be impacted positively following the unstable Chinese yuan and the US stock market. According to analysts, the crypto sector might soon witness massive improvements. They opine that the market volume might soar. This is due to the fact that signs indicate that stock markets in Asia might suffer mist compared to the US.
According to Kathy Lien from BKAM, the current conditions are ripe for a positive performance. The trading pressure will be felt in the upcoming markets. Lien added that this is just the start.
The susceptibility of the Asian market to a crash might be important to the crypto sector. This is due to the fact that most of OTC crypto exchanges usually occur within Asian trading hours as a result of high-level mining pools.
According to Bobby Cho from Cumberland, the volatility issue in the crypto sector has been a major reason why institutional investors have stayed away. He pointed out that a look at the last few months the market trades have been in a very tight range. This stability can be seen as the major reason why institutional investors are beginning to join the crypto sector.
Analysts, however, maintained that institutional investors might finally join the crypto sector. Cryptos might just become an alternative to other traditional forms of value.