Why hasn't the crypto market stabilized after the drop on Friday 10/09?$BTC #Binance
The crypto market has not stabilized because the drop on Friday was not an isolated event. The current instability is the result of multiple factors, including high leverage in the market, low trading volume, and macroeconomic and regulatory uncertainty.
Key factors summarized:
Amplified volatility: The drop was accelerated by the liquidation of leveraged positions, leading to a cascade of sales that the market has yet to absorb.
Low liquidity: The lower trading volume makes the market more sensitive to large sell transactions, which can destabilize prices.
Macroeconomic fears: Global economic uncertainty, central bank policies, and investors' risk aversion continue to weigh on speculative assets like cryptocurrencies.