Rudolf Medvedevs, CEO of Ternion talks about the current lows in the crypto market.
It is that time of the year again: the price of Bitcoin and other crypto currencies has significantly dropped. Whether you put the blame on the inactive for four years wallet that decided to dump some Bitcoin or you blame a single entity that decided to sell over 100K of BTC, the result was a huge short on Bitfinex. After all, too much circulation goes to drive the price down. So, the question is whether we wait for crypto to go back up or whether we need to adjust to the new rates and behave accordingly?
The two main principles that guide crypto market is to buy when there is fear and to sell when there is hype. But there is also another common-sense rule: buy when it’s cheap and sell when the price goes up. That is why if people start buying more crypto than selling it going forward, then we can witness a drive-up in price and thus possibly the next bull-run market.
Artificial market adjustments that are likely to occur will be due to the self-fulfilling prophecy: you believe that crypto will go up, you buy it and thus your actions drive the price up. Crypto currency at the moment is more treated as a product, a price of which goes up when there is more hype around it. The more people want it, the more the price goes up: the demand drives the price and reduces the supply.
The greatest fear we should have now is not about the crypto price going completely down, but our inadequate response to the new crypto currency regime whether the price remains the same or goes up. At times, when the market fluctuates we need to have a few trusted players by our side. We need to have Bitmex with 100x leverage trading, we need to have a digital currency Binance exchange and the licensed, fiat-to-crypto Ternion Exchange. To accommodate our personal digital and fiat finances, we need exchanges that can manage the inflow of people and allow us to sell when the prices go up and easily buy when the hype goes down.