Impacts of economic downturn on cryptos

[gamaman990]

While some people are expecting monies will come into cryptos when stock markets tank, I see the opposite effect is also possible. The large investment funds actually are not scared of stock market downturn as they normally hedge their positions and among the first movers to sell. The fluctuation is actually helping them make more money. These funds won't pour money into cryptos during such times. Average investors, on another hand, will face the reality of shrinking net worth or even margin calls if they play leverage trades. I see little to no needs for them to switch to crypto assets too. After all, crypto assets are still at their infancy stage and don't generate revenue or profits directly. More hot money are seen in cryptos mostly when there's abundant liquidity in the money market. Now with rising interest rates, money influx will be dwindling along the way.

Hence, I'm not too optimistic about money inflow in the short to mid term. A long bear market or at least consolidation like in 2014 is a very possible scenario.

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[nightmanisrightman]

You know what if you had told me that a couple of weeks ago I wouldn't have believed you, now I have opened my eyes up to all the possibilities. It doesn't make much sense for institutional money to get involved right now, and we have lost over 50% of the total market cap in the last couple of months. If this isn't a bear market I don't know what it is. Also I don't know what it would take to turn it around because as far as I knew Bitcoin was still getting new people signing up over at Coinbase but I guess they are not buying much Bitcoin or venturing far into altcoins.

[boyshx]

Obviously, what do you think from where the money drives into the crypto currency and how the whole thing works here?

The stocks are different thing, they are not dependent upon the crypto because they themselves are the first one to come existence and they never relied on any other external forces at all. Apart from this if stock tanks then it doesn't mater because the opportunities are more than enough to liquidate the whole money circulation. Crypto currency falls in next chapter where people like you and me who are deprived of the stock exchanges will always for such easier way to make the money. Thats what running the crypto currency business in first place and nothing else.

Those people who end up locking their funds in the crypto currency are the one who will never think of the crypto because they will end up in bank corrupt if they do so. Thats why the money influx is mostly from he common investors.