How Evergrande’s Debt Triggered The Crypto Crash
Evergrande, China’s second-largest property developer by sales, is plagued with more than $300 billion in total liabilities after years of borrowing to fund rapid growth.
The news sent the Chinese company’s stock plummeting, setting off a chain reaction that saw crypto values plummet across the board.
Although there is no direct link between Evergrande and cryptocurrency, many analysts believe that the problems in China’s property market could lead to a crypto meltdown as investors become more risk-averse.
As worried Chinese property stock investors expressed their concerns, they shifted and exchanged their digital assets in other forms, causing market turbulence.
The value of the world’s cryptocurrencies plunged to a low of less than $1.9 trillion by 8:45 a.m. EDT on Monday, nearly 11% less than 24 hours prior and reflecting a loss of more than $250 billion, according to crypto-data website CoinMarketCap.
Heading up market value losses, the price of bitcoin dipped 9% to less than $42,669 while ether prices fell nearly 10% to a low of $2,940—marking each of their lowest levels since early August.
Even recently skyrocketing tokens like Solana’s sol and Cardano’s ada plunged about 10% at the height of the sell-off.
On the other hand, stablecoins Tether and USD Coin registered marginal growths of over one percent each.
Keep Calm And HODL
While most are panicking and dumping their crypto, others see this crypto crash as an opportunity.
As prices crashed, El Salvador President Nayib Bukele announced the nation took advantage of falling prices and “bought the dip” for a second time this month, spending roughly $6.5 million to boost its cryptocurrency holdings by 150 bitcoins.
“This [El Salvador’s purchase] shows that although the market will undoubtedly fluctuate, crypto will always be a sought-after asset. When the market falls, the only way is up,” according to research by CoinDCX.
The crypto market is indeed in the midst of a massive decline, but this doesn’t mean that investors should panic and dump their holdings.
Instead, take a deep breath, stay calm, and HODL onto it until it recovers back to its original value. The market will recover (although it might take some time).
The entire cryptocurrency ecosystem has been built on the premise of blockchain technology, which is an innovation that will change the world. This innovative technology will continue to attract new users and projects and has a lot of room to grow.
In fact, now is a very good time to invest in cryptocurrencies. We have seen how Bitcoin reached a low of around $3,100 in December 2018. But by 16 February 2021, it surpassed $50,000 for the first time.
Cryptocurrencies have been facing a lot of criticism for being unregulated and extremely speculative. But, they are here to stay. In fact, if you look at the data carefully, you will notice that the market has been growing in a steady manner since its slump in 2018. The reason behind this can be ascribed to the increasing demand for cryptocurrencies from the general public and investors around the world.
We’re all in the same boat. Every crypto holder is waiting for crypto prices to recover and take us back to where we were last year. The only way we’ll get there is with positive, productive action.
There’s no need to fear; if prices rebound, they’ll almost certainly return to all-time highs. So keep calm and HODL! You’ll also be able to easily protect your digital assets using UKISS Hugware™, which will be available very soon.
Stay tuned for information about the launch date of our revolutionary crypto hardware wallet!
About UKISS Technology
UKISS Technology is pioneering the next-generation cryptosecurity wallet that is simple, safe, and secure to use. Their technology has also been granted patents in most major markets including China, the United States, Europe, Asia, and India. Their clients include government ministries, leading medical healthcare providers based in the APAC region, and major FinTech players.
Visit www.ukiss.io for more info.