As many of you are aware the Crypto industry has been crashing, creating fear and large sell-offs in the Crypto markets. Crypto is supposed to be a hedge against inflation and devaluing currencies, so why has this been happening?
Similar to the 2008 Global Financial Crisis and its housing market bubble, Crypto has gone through a similar situation. In 2008, which began with the housing market bubble that ultimately popped, was created by an overwhelming load of mortgage-backed securities that bundled high-risk loans that led to unprecedented numbers of loans defaulting. This is what has been happening to the Crypto industry.
Hedge funds, similar to 3AC, were over-leveraged in the Crypto market believing that prices will only continue to increase. This over-leveraging of these hedge funds lead to an exponential increase in Crypto prices. Temporarily this was great for investors. However, exponentially increased prices lead to the entire Crypto industry being overvalued.
Similar to any industry, sector, or investment overvaluation generally leads to a sell-off from the fear of a market correction. As the Crypto industry started to correct itself into finding a new level of support, over-leveraged hedge funds (who mostly control crypto prices) started receiving margin calls. Due to prices falling these hedge funds failed to meet their margin calls to its lenders. Falling prices and failed margin calls (from hedge funds who mostly control crypto prices) are leading to the downward spiral in the Crypto industry.
We, Crypto Health Plus, have not been impacted by these events. This is due to us being relatively new to the markets. However, we encourage you that have been impacted to be patient and continue to believe in the Crypto industry. As we believe that Crypto can revolutionize the world, we strongly believe we can revolutionize the HealthCare industry. We will continue to push forward and continue to work to change the current HealthCare inefficiencies.
https://corporatefinanceinstitute.com/resources/knowledge/finance/2008-2009-global-financial-crisis/
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