Steemit Crypto Academy Contest - S1W4 - Reviewing The Instability Of The Crypto Market By @solexybaba

Image edited on Canva

Hello to everyone in this great community known as CryptoAcademy I welcome you all to a great weekend alongside a wonderful contest before us all. Today I will be dropping my entry regarding the ongoing contest that has been tagged reviewing the instability of the crypto market. this is a great topic that has been brought forward by the crypto academy contest engagement team as though we get to discuss the instability which the crypto world is currently experiencing. so sit tight and relax as I drop my entry.

Most of the cryptocurrency market is currently experiencing a sharp decline, especially in recent days. what do you think of this drop? state its causes and how long do you think it will continue in this downtrend?

First, of all, let us all keep in mind that we all know that cryptocurrency is very volatile and as such anything is likely to happen. the rise and fall in price are what we know to be expected from the onset, but the recent fall in price has been drastic these days. viewing from the fact that the top coin on the list which we all know as the bitcoin has also experienced a drastic fall due to the high dump of the coin.

image from Tradingview.com

As we can all see with the bitcoin token leading in price, we all can notice a downtrend and with this movement of the bitcoin moving downward all other coins are likely to follow its lead. so as seen from the above the supply of this coin is far greater than the demand for it, and that is why all asset keeps decreasing as though there is much supply of the crypto asset but less demand.

In as much as they need for this coin is in a low ratio then the value of this coin will decrease to a great extent, but when there is a high need for it then the value increases drastically.

Some causes regarding the drop in cryptocurrency market price

The unexpected fall in price as a result of many investors dumping several cryptocurrencies including the bitcoin token, with the analysis from the previous year we could all see that bitcoin got to an all-time high with its price at $66 thousand, and from the beginning of the previous week to this point, we can see that the price of bitcoin token is still struggling to settle at $30 thousand. and today the bitcoin price is currently in the range of $29,325,75k.

screenshot from CoinMarketCap

As you can all see from the below image, the movement of the bitcoin token struggling with the range of $31k to what we see as $29k, the drastic drop of the bitcoin is what triggered other coins to lose certain value. certain reasons triggered the fall in price, most especially the current situation between Ukraine and Russia dispute, this has affected the price of coins in such a way that everyone is now affected.

screenshot from CoinMarketCap

We can also take a typical example from the LUNA token, where we noticed a drastic drop in its value as a result of the token being pegged to what we know as a stable token called the UST. with the fall in its price, the Luna token was also affected the Luna token noticed the greatest loss among all cryptocurrency tokens, falling from its high of $117k to what we are now seeing to be $0.000149.

screenshot from CoinMarketCap

Another problem that has been the reason why we are noticing a drastic fall in the value of cryptocurrency could be traced to when the Chinese government talked negatively about cryptocurrency and it was tagged a fraudulent activity and anyone caught will be penalized. and we all know that Chinese countries are one of the countries that influence the world today, based on that declaration, the cryptocurrency has experienced a huge fall in value and to date, it is still wallowing in that trend.

We can cite another example here in my country Nigeria, cryptocurrency is considered a fraud, and anyone caught trading cryptocurrency especially making transactions through the bank will be penalized banks do not accept any transaction that is related to cryptocurrency. when a transaction comes in with any word related to cryptocurrency that transaction will be canceled and as such any fund regarding that transaction will be ceased. so these are some reasons why the cryptocurrency world is experiencing a huge dip in price and value.

HOW LONG DO I THING THE FALL IN PRICE WILL CONTINUE?

With the way things are moving and with the look regarding the market movement, this downward movement is likely to continue for some period and then we can likely see a retracement in market movement. again if should peradventure we notice a change in the mind of the Chinese government and financial institutions such as the banks then fortune can smile at the cryptocurrency market again. but for the time being, we will keep noticing what we called haphazard movement in asset prices until it finally arrives at a certain situation where we can notice an uptrend in market movement.

Also, cryptocurrency is a currency that is controlled based on the happenings in the world most especially in countries with strong hands, so if anything is happening to certain countries it affects the stability of the crypto world especially when there is unrest or dispute between certain countries, the p[rice of cryptocurrencies decreases so much and then investors are likely to drop the currencies with that we get to see more supply of cryptocurrencies but less demand of them.

WHY DOESN'T THIS DROP IN THE PRICE OF A FEW COINS DECREASE THEIR TRADING VOLUME (e.g, Bitcoin)?

Yes, we have noticed that the drop did not affect the trading volume of some currencies, especially the bitcoin is because with the number of individuals supplying these currencies there are still investors in the market who are willing to buy these tokens and with that, we can see what we called as equilibrium constant, that is the amount of supply and demand volume are constant.

With the various exchanges happening in the market, we can see that the range at which investors supply these tokens are in line or almost equal to the range at which other investors are ready to pick up these tokens, and with that, we can see that the trading volume of certain crypto assets is kept in.

screenshots from CoinMarketCap

We can as well go to our device browser to visit the coin market cap, and as seen in the image above, some screenshots from the coin market cap, the Ethereum, and Bitcoin tokens still maintain a balanced trading volume. so regardless of the fall in cryptocurrency prices, they still maintain proper trading falling as though when investors are selling others are also ready to buy.

WHAT IS THE RELATIONSHIP BETWEEN THE CURRENT INSTABILITY AND THE DOWNFALL OF THE TERRA ECOSYSTEM AND ITS LUNA CURRENCY? DO YOU THINK ITS PRICE WILL BOUNCE BACK? IF SO, TELL US HOW AND WHEN?

With the issue regarding the cryptocurrency named Terra and Luna, it has been one among the reasons why we noticed s decline in cryptocurrencies price, when we experienced a high fall off in its price, causing investors to sell their crypto assets being afraid of what token might be the next victim because the priced dropped from what I could notice at $117k to what we could see now as $0.000149.

We all know that Terra Luna has been pegged with the UST which we all know as a stable coin, so if there is ever going to bounce back, the UST token will be the token to watch out for. technically as we all can see the UST token has also dropped down drastically, a token that was quite closed at $1.00 is now within the range of 44 cents. and the Terra Luna was pegged to this token, s whatsoever happens to this coin will equally happen to Terra Luna.

screenshot from CoinMarketCap

So as we all can see from the screenshot gotten from coinmarketcap, with the UST price struggling in that range, it will be quite difficult for the Terra Luna token to bounce back to where it was initially.

OUR STEEM ECOSYSTEM, LIKE MOST CURRENCIES, HAS BEEN AFFECTED BY THIS MARKET DOWNTURN, HAS THIS CAUSED YOU AS A USER SOME STRESS? OR ARE YOU STILL CONFIDENT IN THIS PROJECT? GIVE YOUR OPINION, SPECIFYING THE ARGUMENTS THAT SUPPORT YOUR VIEW.

As most currencies have a drastic fall in price and so the steem token is not an exception, we all know that the crypto world is volatile and so whatever happens to the strongest tokens like the Bitcoin and the Ethereum token, will affect the rest of it all.

We can all see that the steem token also was affected by the drastic fall, thereby reducing every user's account value. despite the power-ups, the account keeps fluctuating in value, and with that comes great distress and this is as a result of the fall in the price of steem.

Also, the fact that SBD is not that available regarding the rewards, we get on curation is quite a thing to be worried about, because this has so affected not only the cash-out but also our power up. we normally earn SBD, Steem Power known as SP and Tron, the SP is automatically powered up, and then the SBD is then transferred and converted to steem in the market, so this depends on the individual clubs we all belong to, now SBD has become something to worry about as though we can see it is getting lesser daily and this will reduce the cash-out, but we are quite confident on the steem blockchain as though we are all noticing a retracement in price from the bottom trying to go back to the top.

Although we can now get SBD regarding curation, currently we are noticing a downward movement regarding the SBD, but I have high hope regarding the SBD because previously we noticed in the past week, that the SBD was nowhere to be found among our rewards when one is curated, we only get STEEM, SP and TRON, but along the line, we noticed that the SBD came back and now it is still struggling as it is not in circulation supply. but then if it could come back before, it will be back fully again.

CONCLUSION

When we talk about instability in the price of cryptocurrency is what we all as users should expect as the crypto market is volatile. anything can happen at anything time, although some falls in price are so drastic regarding tat of the Terra Luna then we should be optimistic that when cryptocurrencies price falls there are tendencies they will surely rise again. so just as it was in the beginning, although this is not certain, we should all be hopeful that everything retraces back to where they were.

A big thanks to all the team here in the crypto academy for bringing up a great topic that has been educative and with that users can air their views regarding the great topic, this is the best topic so far among all communities. I look forward to seeing more of such kind of educating topics. I will like to use this medium to invite some users, @badmus-official, @weasell, and @victoh78 to also give their opinion regarding this contest.