THE BEGINNER'S GUIDE TO CRYPTO ~ PART ONE ~ WHY DID THE MARKET CRASH AND WHAT DOES IT REALLY MEAN? READ THIS ARTICLE IT IS 5 STAR!

Seems like everyone has a theory on why Bitcoin is plummeting and other coins have been on a fast track down with it. One thing is for sure, the market suffered a combined loss of over 30 billion dollars in just 10 minutes (yes, with a B), sending a lot of investors running with their tails between their legs, skulking the entire time. Here's a fun fact, the loss crypto suffered in just 10 minutes, surpasses the entire size of the economy in the country of Estonia (as well as hundreds more). Bet you didn't know that one. I think I just earned an upvote LOL.

With Bitcoin dropping down below $10,000 on Coinbase, Binance and other major exchanges, a gruesome reality struck us. Crypto cannot be controlled and the market cannot stabilize until people understand the market and how to prevent incidents like this from occurring. Not only did Bitcoin get smacked hard at over a 28% loss, but Ethereum fell 30% and Ripple witnessed losses of up to 1/3 it's value. This was the result of a massive hysteria and paranoia, prompting fear to consume investors, resulting in massive selling of coins all over the globe, not just today, but for the past week. To the average Joe, it looks like a smart move to take all of your funds out before you lose them, but in fact, the market would actually level out and go back on a rise a lot faster if folks held onto their coins. Mass sales are what create these crashes and when you sell off, you are selling out, point blank. Your actions, contributed to the loss of billions of dollars. The best thing one can do is be patient, wait for things to settle down and things WILL return to their natural state. Patience is indeed a virtue, acting out of fear however, is not.

So with such losses clearing the board and plowing crypto into the dirt, what exactly caused this collapse in the market?

The reason the market is suffering such large scale loss is due to world governments, specifically in Asia, outlawing and banning cryptocurrency mining, trading and use in general. It started with South Korea just under a week ago, raiding one of the leading exchanges, Bithumb, and shutting down their physical operations, which caused their exchange to crash, resulting in a worldwide plummet, but not of the scale we had seen today. This was just the beginning of one of the worst weeks I have personally seen in crypto. Aside from raiding exchanges, the South Korean authorities have enacted a ban on trading and working with crypto, citing it as a crime, with fines, seizures of crypto as well as equipment harboring it and possible incarceration. This sent initial shock waves across the world, starting the first series of "fear selling", causing a tremendous drop in the crypto economy. This was the initial blow to the cryptocurrency economy.

Not long after this series of incidents, China openly began a ban on mining, or the production of crypto, throughout the entire country, stating that the power consumption such tasks consume would ultimately drain and destroy the structure and economy in China. When mining bans began, the government then pressed forward on complete bans, prohibiting the sale, use and possession of cryptocurrency within the country and deciding to block international users from trading with the Chinese citizens. Along with this, began the shutdown of Chinese ICO's (Initial Coin Offerings), police control over the internet and complete nationwide bans. A truly sad day for the citizens of China just looking to change their lot in life! With such oppression from world government, this spiked a surge of mass crypto selling, causing another drop in the crypto market, which had not yet even recovered from the incidents in South Korea. This was the second blow to crypto this past week.

Shortly after, China declared what some are calling the "War on Crypto", similar to as some describe, the "War on Terror" or "War on Drugs" launched by other nations across the globe. This effort by the Chinese government developed into full scale raids, seizures and confiscation all across the country. By targeting exchanges, storefronts, underground traders and more, they officially went on the warpath and heavily disrupted trade across the world, causing what we have at hand now. In combination with China's armed forces and police kicking in doors and snatching up people's investments, a sole hacker managed to steal $400,000 USD worth of Stellar Lumen coins at the same time other significant confusion was rocking the crypto market. The good ole' smoke and mirrors trick, huh? Needless to say, it was a setback for XLM. This hack as well as the physical raids in China, were the latest series of events, leading up to this weeks market collapse.

So what drives a market in general? What causes prices to go up or drop down?

The answer to this, is actually multiple answers. There is no one thing that drives the price, but more of a collective. However, there are some things with more sway than the others as far as causing increases or decreases within the market. First, world news seems to have a pivotal effect on the market value of crypto. Just take an example off of Asia's War on Crypto. Every negative thing, has driven prices down. On the opposite side of this, you can see prices rise when a company announces a new program or adjustments to their operation that seem attractive to investors. All in all, factual events tend to have a large scale effect on the market.

Rumor, unfortunately is also a very large driving force behind the rise and fall of the market. The act of using rumors to effect prices is frequently called market manipulation, which is illegal in the stock market IF someone is found responsible for such action. This is typically performed by collectives of people, looking to "pump and dump" coins for a quick profit, based off of the loss of others from manipulation. This is highly frowned upon within the crypto community because of it's lack of ethic or morals, but still is a large factor in some market crashes and spikes. This leads into our next answer.

Fear is a HUGE factor in what drives a market. In the event of a crash, it is actually THE LEADING CAUSE of a market crash. People invested, become fearful of losing their money, due to world events, rumors or even the slightest fluctuation in a coin, dump large quantities of coins typically in a very short amount of time, causing prices to plummet dramatically. What most people fail to realize is that SELLING OUT DURING A CRASH IS THE WORST POSSIBLE THING YOU CAN DO BECAUSE IT INDEFINITELY CAUSES MORE SEVERE OF A CRASH WHEN THE MARKET LOSES MASSES OF EQUITY! If more folks were mindful of what I just said, the market would likely be back to normal already after the past week. But, unfortunately, people ran and took cover when China started hitting exchanges, so here we are, in a slump.

Buying and Selling is the key force that drives the cryptocurrency market in general. When one buys into a coin, the company gains more money, which increases the value of the coin. When masses of people buy in, this is how numbers can jump dramatically. The same goes for selling, as described in the above paragraph. Selling in mass quantities can cause sudden and significant drops in the market as a whole. Ultimately this is the key event that determines the price of a coin and the condition of the market.

So is this crash in the market the end of cryptocurrency or a worldwide tragedy?

The answer to this is both yes and no. This is not the end of cryptocurrency as a whole, because as long as there are two people in this world believe in crypto, it essentially will still be going, in theory. In my honest opinion, nothing will bring crypto to it's knees, not massive sell outs, crashes or even world government interference. It simply is too strong and too well established at this point. However, you will see the demise and certain fall of some coins that have been in the market for a while now. Which coin? That's merely speculation at this time, but bet your bottom dollar on several going belly up over the next couple of weeks unless a God given miracle blesses them. Definitely expect to kiss 10% or more of the altcoin market goodbye!

Considering this a tragedy, is both correct and wrong. Personally, due to my high standing morals, do consider this a tragedy, simply because I envision those who lost more than they could afford. Those who were tricked into a pump and dump at the wrong time, those who went all in for their big dreams, the husband who went bankrupt today or the wife who lost her husbands stash of cash because she tried to help build the family up. I envision all of the situations that are life changing, and yes, I feel for these people. I truly feel empathetic for them whether it was their fault or not. Losing financial freedom is one of the worst prisons you can put yourself in. At the same time, what happened this week was a true, in our faces blessing. This displayed how volatile the market is, giving us all insight on how to fix this. This crash, has weeded the garden per se, eliminating "shitcoins" and vultures, as well as an overpopulation in the trading realm. This crypto purge, has paved the way for prosperity, IF we, the people utilizing cryptocurrency, educate ourselves enough to know how to properly handle these situations and set ourselves up for prosperity. This crash, will turn out to be the biggest blessing Bitcoin and the crypto market has received, mark my words, the strength the market receives from current events here lately will ultimately build the foundation of crypto and what crypto stands for, to an unbreakable level.

So what advice is there for new investors or someone who lost a lot?

Do some research on the companies behind the coins. Look into promising ICO's, not these fly by night dirt bags looking for a get rich quick scheme. Pick out a portfolio to invest in that you are comfortable with, make sure to include some big names like ETH, BTC or LTC. DO NOT invest what you aren't potentially able to lose, this is the rule of thumb with ANYTHING in life. It's not a guarantee you will lose your money, but with any business or investment, the possibility stands that it could happen. Ask folks for help, such as the Steemit community, online groups, investors, whoever will offer up advice on the market. I myself will gladly answer any questions you may have! BUY NOW IF YOU ARE LOOKING TO MAKE MONEY, simply because the market is down at an extreme low and this is the perfect time to jump in. Strike while the iron is RED hot! And last but not least, trade with ethic and morals. The market is built on a complex idea of bettering the world as we know it, the last thing crypto needs are a bunch of crooks running around, manipulating the market, stealing or otherwise causing harm to cryptocurrency as a whole. Respect the market and it will respect you!

I hope that everyone enjoyed this post. Please follow me @terminallyill and read my other articles. I also post music on dtube and youtube, please listen to my original tracks and show me some love. As always, upvotes and resteems are appreciated. Last but not least, please comment and interact on my posts. Tell me and others what you think. Share your voice with the world, I embrace this kind of interaction!

Thank you all for your time, good luck in crypto ladies and gents :D