Reasons why cryptocurrency currently trade on the red

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Good day steemians, I am pleased to be with you friends again. In this season of the cryptocurrency red CAN WE VOLUNTEER TO INCREASE THE BURNING RATE OF STEEM to make STEEM green in the crypto market? To set the pace I DEDICATE 75% my earnings in this post to @null. Today I am writing on the possible causes of the dip experienced in the virtual currency world.

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All major crypto currencies have trading on the red lately with the fall testing even long term holders are affected, practically the global cryptocurrency market peaked at $2.9 trillion in November 2021 but now it has dropped to about 0.9, checking closely we see that even Bitcoin which the largest crypto currency is at its 18 months low, plunging to $21000 as at June 16 2022. With this reality we can say Bitcoin has dropped 60% this year moreso the second largest crypto Ethereum has dropped 25% percent to $1100.

It started when Luna Terra crashed, it was an event that had several consequences for not only it's investors but the crypto ecosystem as a whole. many investors lost their life savings parked in Terra coin, a stable coin with over 18 billion dollars market cap before the crash.

The equity market

Luna losing it value 99.9% Terraform labs the driver of the company sell of the entire Bitcoin reserves to bring back the peg to $1, which they eventually failed to do. As a result it wipes over$40 billion out of the crypto market. This is because the crypto market is Link with the equity market, if a downtrend is witnessed in the stock market the same is being replicated in the crypto world many of the factors that affect the stock market also affect crypto prices.

A report from new York times shows that Bitcoin price movement is closely mirrored that of the nasdaq, a benchmark that's weighted towards tech stock. While crypto markets should ideally perform independent of the traditional markets, they have been sensitive to movements in the main stream financial world.

Celsius network

Celsius network a decentralized finance announced on Sunday that it is freezing all the crypto transactions citing "extreme market condition" following the shut down an enormous sell off was seen where all the crypto plunged.

Stable coins are supposed to be measured with fiat currency like USD and any other Fiat money of any land, and exist basically so that crypto investors can get in and out of the fiat early with no third party like bank to approve these transactions, example of stable coin is USDT, USD coins, USDC, BUSD. The above mentioned stable coin are pegged to us dollar issued by the central bank. This entity own a Treasury of dollars as cash reserves or commercial paper that back each $1.

Crypto now is in the dip but together we can help reduce the STEEM supply Then the price will increase accordingly.
Thanks to STEEM development of steemit community together we will change the world.

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