Cryptocurrencies
Cryptocurrency is a digital asset used as a medium of exchange between users. It is created using Blockchain technology to store the owner’s information and other data. Cryptocurrencies became popular after Bitcoin was introduced as the first digital currency in the general market. It was created by an anonymous developer-only known as “Satoshi Nakamoto”.
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How does the crypto market function?
The Cryptocurrency market is an online market that works on the principles of decentralization. There is no central authority or a third party to monitor all the transactions in the Blockchain network. The market is highly volatile and can change its direction at any moment. The Crypto market mainly depends on the process of demand and supply.
Factors affecting the Crypto market
Multiple factors contribute to the movement of the Cryptocurrency market. The value of the project being developed, demand for the crypto coin in the market, global market, political news, and the number of buyers and sellers of the particular crypto coins.
Value of the Project :
The value of the project is a crucial factor for which the crypto coins have been distributed to the investors. It contributes to the crypto-coins market value. If the project has a good reputation among the investors and has good market capital. In that case, the cryptocurrency value will be high, or the value will decrease.
Demand for the crypto :
The demand for cryptocurrencies plays a huge role in its market value, and if there is a huge need for crypto in the market, the value will increase.
Global market :
The global market also contributes to the increase or decrease in the value of cryptocurrencies.
Political News :
The political news and the government’s decisions will have a huge impact on the Cryptocurrency NFT marketing and the value of cryptos. Countries legalizing crypto in their region increase their importance.
The number of buyers and sellers :
The number of buyers and sellers will directly affect the market and its crypto value. If the number of sellers is more than buyers, then the value will lower, or sellers are less than buyers, then the value will start to increase.
As mentioned above, the following factors contribute largely to the changes in the value of the crypto in the market.
Now let’s see how the current war between Russia and Ukraine has affected the Crypto market.
The invasion of Ukraine by Russia last week has brought more volatility to the crypto market. The financial losses are just one of the many disadvantages of war. Experts fear the loss of human lives on both sides of the conflict. The President of Ukraine Volodymyr Zelensky announced its citizens to defend their homes against the Russian soldiers and attacks.
The war definitely will change the course of the Crypto market; the value for all cryptocurrencies has started to fall. Bitcoin has lost almost half of its value, and Ethereum has also taken a huge hit.
Effects of war on Infrastructure:
The destruction of the infrastructure creates huge damage to the societal routine and structure. It directly affects education and the healthcare system. It affects transportation which makes it impossible for the economy to function.
Labor force :
The labor force is affected in a multitude of ways, most often due to the drastic loss of life, change in population, movement of refugees, and destruction of the organization.
Society :
War directly affects the communities and families of the society by disrupting and psychologically harming children and adults. It reduces society’s resources and human capital.
Finance :
War, directly and indirectly, hits the finances of the country. The effect of war is that it imposes a higher tax on wages and profits to reduce demand.
Displacement :
Displacement or forced migration happens mostly during the time of war. It adversely affects both the individual and community. Many people flee their homes in fear of losing their lives and their families and thereby become displaced internally or externally.
Environment :
War demolishes the environment in untold ways. It destroys the natural habitat, thus disturbing the wildlife of that particular region.
Education :
In times of war, the country is in an economic crisis and thus an increase in poverty, resulting in the decline of education.
Gender :
The war affects the male directly by taking lives in the conflict. The females are mostly affected indirectly in terms of health and psychological.
The effects of the war on the Crypto market
War affects all the resources in the country, making governments focus completely on the war and leaving other fields that support the country without any aid.
As discussed above, the Cryptocurrency market is highly volatile and can change its course at any moment. Therefore the ongoing war has a huge impact on the crypto market. The war has made the market bearish, making people stop investing in the market.
The Crypto value has decreased, and the current market capitalization is as half as it was in November 2021. The war has given fear to the investors that their investment might be lost. Many investors have withdrawn their funds from the market due to safety reasons.
Experts on the Crypto market
The financial experts in the market urge people to stay calm during such hard times, as the market is always volatile and will keep changing course. The market has seen lower status and came back stronger than before. It is a time of the bearish market; after everything settles, things will be back on track, and the value for cryptocurrency will again rise. Cryptocurrency is the future of the digital era we live in, and it cannot be ignored. Therefore keeping calm in such times is the only way to gain profits later.
