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Bitcoin, Ethereum, Ripple, Dash, all other cryptocurrencies paint crypto markets red

Call it a major correction or panic driven sell-off or whatever else you deem fit, but the current state of crypto markets will give a faint hearted trader or investor a death blow.

Price of all cryptocurrencies including Bitcoin, Ripple, Ethereum, and Bitcoin Cash are down – some by over 30 per cent day-over-day – and this downward slump has wiped off $400 billion off the market in a matter of just 24 hours. The prices of cryptocurrencies are on the decline since January 15  and this has led many traders to sell off their entire crypto inventories and book as much profit as they can in this bloodbath.

There were claims that bitcoin hasn’t witnessed a major price drop compared to other cryptocurrencies, but that’s not true as bitcoin has also seen a huge 21 per cent decline over the course of last 24 hours. Since December, bitcoin has dropped from $19,000 to $9,500 as of this writing.

We wouldn’t like to attribute the current decline in cryptocurrency prices to trading ban fiasco in China and South Korea. The Chinese market do not handle huge volumes that could impact global cryptocurrency market in any way.

While many would think that this is a major fall from which cryptocurrencies will not recover, this assumption is entirely incorrect because 20 to 30 per cent corrections over the course of 24-48 hours isn’t uncommon.

Looking at recent past we have seen major corrections when the People’s Bank of China (PBoC) and the Chinese authorities banned initial coin offering (ICO) along with cryptocurrency trading in September. Prior to that Ethereum suffered over a 50 percent decline, from $360 to $134.

What we believe is a major correction is healthy for the market. Blockchain projects with no products and users have gained multi-billion dollar valuations, solely with poorly drafted whitepapers. This is where such projects lose the inflated valuation and never recover, while properly designed and in development projects bounce back.

Richard Newman

Richard is the Editor-in-chief of Bitcoin Journal. He has over 10 years of experience with the news industry mainly handling the editorial cycle.

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