The cryptocurrency market has drawn the attention of several people and does continue to gain popularity. The most advanced cryptocurrencies, such as Bitcoin, Ethereum, Litecoin, and Verge have grown in tens and hundreds within a short span of time.
The dynamics of the exchange rate depends upon the supply-and-demand.
The media can effectively manipulate the public. News feeds are indeed able to instill panic as well as fear in a mass manner along with euphoria.
Market majors, as well as thought leaders, do control the market with the help of FOMO (fear of missed opportunity) and FUD (fear, uncertainty, and doubt). The financial giants act as catalysts in the price rates.
Bitcoin does indeed serve as a support and leader of the cryptocurrency market. In certain cases, funds do flow from the altcoins into bitcoin, thus encouraging greater growth.
Newer platforms, an enhanced interest of investors as well as the deployment of detachment have indeed a positive impact on the long-term growth of assets.
The growth of the cryptocurrency market is indeed conditioned by the opposition to the traditional economic foundations. Thus striving for independence, anonymity, security and faster, cheaper transactions do lay a solid foundation for the development of the cryptocurrency market. This will indeed improve the spheres of life not only for ordinary users, but will also make the business more transparent and efficient. If the legislative and regulatory situation does stabilize, then the cryptocurrency market will indeed continue to confidently move towards a rather new economic system.
Acute political situations can indeed impact and destabilize the cryptocurrency sector. It is essential to appreciate that regulations can also mean positive effect on market development and will also basically translate into market maturity as well as adoption.
Regulations do provide clarity as well as protection of clients’ assets, which does imply that more risk-averse investors and institutional investors can also get into the fray.
Economic factors, such as inflation, devaluation, and dependence on emitters do impact financiers. The cryptocurrency market is indeed young as well as vulnerable. Strong volatility has no doubt a negative impact on the recognition given to cryptocurrency as a means of payment.
Adoption in society
The business industry does strive to implement blockchain technologies in its infrastructure, thus widening the range of given applicability of cryptocurrency as a means of investment, or making purchases or paying for services.
The market is unpredictable and cryptocurrencies are new, faster and more efficient technologies on the market that will impact the demand for older ones.
Security problems and bankruptcy
System breakdowns, hacker attacks, and the closure of exchanges these issues need to be taken care of. Losing funds in their wallets can lead to market collapse.
Organized pressure on the markets
There are coordinated attacks on the market which are accompanied by negative news and the spreading of panic can be purposeful and planned.