Are Exchange Layoffs the First Sign of Crypto Winter, or Is It Already Over
The economy is trying its best to withstand daily challenges. Fluctuation of exchange rates between foreign and domestic currency triggers economic instability. Would there be stability among investors and businesses worldwide?
Inflation holds a major role in maintaining homeostasis for economic development. The US Federal Reserve strives its best to weigh the scales in favor of stability. However, despite all efforts, a question of exchange layoffs is at stake.
Cryptocurrency is making its way against the financial crisis. Would it prove feasible amidst the exchange layoffs happening in some of its branches? Let’s find out.
Traditional financial institutions can lend you money for investment. The problem is its interest rate. While others offer a much lower interest rate in making loans, you’ll still need to pay for it. The bottom line is, that no matter how small an interest rate is charged, it’s money at your expense.
How can you cut off interest rates and invest your resources in a better option? The answer is decentralization. You need to unshackle from the bank’s chains.
In 2009, an unknown personality (or a group of people) with the pseudonym of “Satoshi Nakamoto” made the first decentralized digital currency. The absence of a regulating authority enabled cryptocurrency to become well-known among investors.
It paved the way for a modernized digital denomination system without the absence of high-interest rates. This captured the attention of people worldwide. Soon thereafter, the use of crypto in making transactions for businesses and shopping developed.
Each transaction runs through a cryptocurrency payment processor. This processor helps individuals in paying bills, transferring funds, or making exchanges. It developed marketing by introducing to merchants how to accept cryptocurrency payments.
For instance, learning how to pay with USDC is more convenient than online bank transactions. It saves you the hassle of paying interest rates.
The decentralized digital denomination system developed a blockchain payment gateway for economic development. Learning how cryptocurrency works enhance the ease of access and promote faster deals.
An Uprising Challenge
Although the crypto market proved stable in terms of swift, secured transactions, a problem arises. Cryptocurrency bounced back from many challenges over the past few years. However, the latest exchange layoffs by some of its branches took a toll on the market.
This threat puts the entire crypto population at stake. As layoffs are made, the value of each cryptocurrency fluctuates. The fluctuation could damage the economy as businesses adopt cryptocurrency as a catalyst.
The industry is at stake with the unstable exchange rates brought by layoffs. The menace of a crypto winter threatens the stability of economic balance.
The crypto space made a promising expansion in 2017. The ICO boom made a homerun in December 2017 which fueled the growth of the crypto market. As such, companies and other business industries engaged with the funding mechanism brought by cryptocurrency.
It pumped up major industries like Apple and Epic’s Fortnite. Crypto startups were the apple of the eye for unleveraged retail investors.
Euphoria brought by crypto pushed companies to change their names. The terms “crypto” or “blockchain” became a trend. To some extent, a makeover of the overall company operation embraced the new crypto trend.
However, the uncontrolled boom of investments and lack of regulatory bodies gave birth to an unstable industry in 2018. 90% of the total projects made during the ICO elation failed in less than six months because of the lack of proper logistics.
It triggered a domino effect for investors to raise uncertainty. Failed projects and multiple scams added fuel to the fire. The threat of banning crypto trading from other leading countries worldwide made it worse.
This became the first “crypto winter." It marked the beginning of a crypto downgrade. For 18 months, investors suffered a long run of low prices. With minute levels of engagement and interest, it made a graph of flat figures.
By mid-2019, the market started to recover. However, the effect of the COVID-19 pandemic became another horror. In March 2020, the market crashed.
Recently, the crypto space faces another challenge. The shocking crypto exchange layoff surprised the crypto population. This crypto exchange layoff decision made a dramatic impact.
A mass withdrawal for the May 2022 new hires threatens another crypto winter challenge. Downgrading of equity and increasing interest rates challenge the economy. Should this continue, speculations for a crypto winter might become a nightmare.
Surviving the Fall
It’s possible to survive the crypto winter no matter how hard it may seem. Using the right mindset and leverage, get the upper hand in the crypto space. As an entrepreneur, failure is part of the game. Just make sure to bounce back.
Learn how the market behaves. Study the trend and brace yourself from impact.
Understand that the market is highly volatile. Stocks may rise as fast as it gets, but on the other hand, drops within a blink of an eye. Know your limits and prepare to lose resources.
Crypto space follows an ever-changing pace. Don’t wait to hit rock bottom but anticipate an upcoming fall. Learn strategies about making investments. For instance, you can check on Dollar-Cost Averaging (DOC) and know how much and when to invest.
Exchange layoffs threaten the crypto space. The instability brought by repealing new hires increases. This puts the economy at risk.
Will there be an upcoming crypto winter? We can never tell. Understanding how volatile crypto behaves gives you an idea of how the market behaves. The most important thing is learning to prepare for an anticipated crypto winter.
Guard your investments and utilize available resources. Should a crypto winter happen, nobody can tell until when it lasts. Be prepared rather than suffer from its turmoil.