What Caused the Crypto Crash in 2022?

What Caused the Crypto Crash in 2022?

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The world of cryptocurrency is very interesting. There are times where coins are rapidly skyrocketing in value, leading to a multitude of success stories – on the other hand, there are many instances where the market takes a hit and coins lose their value. This was seen in 2022 during the crypto crash, where near enough every token lost a significant amount of value. If you are interested in investing in crypto, then you might be hesitant to do so as you worry about the chance of another crash. To ease your mind, it is worth knowing what caused the crash so you can develop a better understanding of the market. The causes of the crash are going to be discussed in more detail below.

Rising Interest Rates

Interest rates have been rising all over the world recently and these are one of the biggest causes of the crypto crash in 2022. These rising interest rates made it so that holding cash was a much more attractive option relative to investing in assets as the interest that could be earned from savings was higher than some assets. This meant that a lot of people began to sell their crypto assets, resulting in a large fall in demand. Investors in crypto now need to keep an eye on interest rates and determine whether or not they are going to have an impact on crypto in the future.

Crash in Terra Luna

Another one of the key reasons why there was a crypto crash in 2022 was the crash of Terra Luna. This led to the devaluing of Luna crypto which feel 96% in a day, bring in the price to less than 10 cents a token. Before this crash, Terra Luna was one of the biggest players in crypto and suddenly lost its value by nearly half a billion dollars. This led to a massive devaluation in crypto as a whole, meaning the likes of Bitcoin, Ethereum, Litecoin and other popular versions of crypto all lost their worth.

How to Deal with Future Investment

There are a few things that you can do in order to stay on top of cryptocurrency moving forward and avoiding being a victim of further dips in value. One of the main methods is by utilizing the right resources and staying on top of everything that’s happening within the market. You can do this by visiting OKX which provides plenty of up-to-date value of different variations of crypto. For instance, if you invest in Ethereum then you can check ETH current prices at OKX regularly to keep on top of your investment.

You should check the trajectory of different tokens in order to work out whether or not you should be selling your current tokens. On top of that, sites like OKX also offer information on chances that are happening within crypto. All of this can give you excellent insight that will allow you to stay on top of what in the past has been a reasonably unpredictable market.

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