The Great Crypto Plummet.

Earlier this week we saw one of the greatest corrections in the crypto currency market. The value of many high profile currencies such as Bitcoin(BTC), Ethereum(ETH) etc. plummeted by a substantial amount.

Cause:

One of the major reasons for this crash could be due to the latest announcement made by China regarding its financial institutions.

China recently announced a BAN on its financial institutions from providing services affiliated with cryptocurrency transactions. Chinese investors have also been warned against speculative crypto trading. This means that monitory bodies, banks, E-wallets etc. are banned from providing their clients with services containing an exchange of any cryptocurrency making virtual currency unsupportable by real value.

Another influencing factor to this crash could be due to a recent tweet by Elon Musk(Founder of Tesla).

In Musk's latest tweet, he shared with us information regarding Tesla & Bitcoin and how Tesla ,Inc will be suspending product purchases using Bitcoin(BTC) as you can see bellow.

 Effects:

As per the Data from CoinmarketCap.com 

The current price of Bitcoin(BTC) is $40,492.93 showing a correction of about 37.1% since its last all-time-high being $64,433.4 on April 14 2021.

The current price of Ethereum(ETH) is  $2752.92 showing a correction of about 36.3% since its last all-time-high being $4,321.8 on May 12 2021.

 What lies ahead:

Even though a crash of this magnitude is jaw dropping, its nothing big and veteran investors didn't see coming. These types of corrections are common in any volatile market especially in the crypto market after such events. Nevertheless, Bullish investors continue to urge long-term and big time investors to analyze their original investments in the market before defenestrating their holdings.

Quoting Konstantin Boyko-Romanovsky, CEO and founder of Allnodes, in emailed comments. "Correction in the cryptocurrency market is a common phenomenon. It doesn’t mean, however, that a bear market is under way".