CRYPTO IS THE GLUE OF THE MARKET

avatar

image.png
source

There are so many terms associated with the financial market, you can find yourself behind before it makes sense to you. With crypto we have quite a few but you get accustomed as you move along. DEFI, HODL and many more are being used to point out the system is evolved. Margin call and margin loan are paving the way when the market is moving alongside the bear market.

You do not hear margin call that often when the bear market is just passing by for a week or so. The way the situation is growing this is everyday story a company is falling into bankruptcy putting more pressure on investors to recuperate their funds.

MARGIN CALL

Margin calls are when banks are asking forcibly for the investors to put up more collateral for the debt accrued. When there is a bear market, companies collapsed this is when you hear the term. Margin loan tends to derive from borrowed funds for the purpose of investment.
What truly intrigued at the moment, some investors used the fund to invest in crypto, giving them more leeway to earn more profit due to volatility in the realm.

When we talk about making millions, crypto is right in the middle. So the minute a margin call happens the investors will sell the strong asset. In the case it is mostly technology companies, and crypto on the other side, putting pressure to BTC.
The ladder does not go as high as previously thought.
It has happen for many times for the past month. Many investors had to sell crypto to pay debt causing a cascade to the crypto sphere.

To unwind the drama, the investors will never sell the weak asset knowing they will lose more than others. It shows crypto did fulfil what it was intended to do since the beginning, bring itself as a class of asset where you can move it around as please.
It shows why decentralization will help to fix this part of crypto.
Bad actors will always find ways to play the system but the bear market is another way to see what is strong and what is weak down the line.

Crypto has different exercise in the market. While BTC will always find the first place for the time being, it is due to its deflationary consensus. Other cryptos will bring new blood and new format to grow every where.
Having an ongoing idea of where crypto is heading is key to see why it is capital to invest in secure blockchain at the right time. It is well to examine where the community is heading. What are they working on?
Do you fully understand the blockchain?
This part could be hard to achieve but time can be a savior.
Having to see how margin call can bring down crypto is to show crypto is an integral part of the financial world.
Crypto is not for everyone but anyone can manage to understand where they can find a niche community to grow their expertise in crypto.
Everyday you need to do ample research and then invest in you.

Posted Using LeoFinance Beta



0
0
0.000
12 comments
avatar

Nevertheless to have knowledge about Crypto means to be involved deeply, I do not know about margin call or how the bear market is being taken advantage of but then, it's been proven that this is where weak hands are differentiated from the strong hearted.

@tipu curate

Posted Using LeoFinance Beta

0
0
0.000
avatar

I did not know margin call had anything to do with crypto.
It is clear crypto is a strong asset during time of despair.

!BEER

Posted Using LeoFinance Beta

0
0
0.000
avatar

There are so many terms associated with the financial market, you can find yourself behind before it makes sense to you.

Check out the LeoGlossary project :)

Posted Using LeoFinance Beta

0
0
0.000
avatar

Thanks for the reference.
It is shown that Leofinance is cementing its weight past social media. It is a place where knowledge is alive.

Thanks for the input.

!BEER

Posted Using LeoFinance Beta

0
0
0.000
avatar

This post has been manually curated by @bhattg from Indiaunited community. Join us on our Discord Server.

Do you know that you can earn a passive income by delegating your Leo power to @india-leo account? We share 100 % of the curation rewards with the delegators.

Please contribute to the community by upvoting this comment and posts made by @indiaunited.

0
0
0.000
avatar

Margin calls with the crypto is complex. It can swing 20% within minutes, not something I know much about. I have bought many stocks with margins, that's about it !

0
0
0.000
avatar

Most people will look at the price because it's the easiest way for them to consider the value. However, I don't really think crypto will really take off until we see more real world applications use crypto. So in a way, we need to see more utility for crypto.

Posted Using LeoFinance Beta

0
0
0.000
avatar

I never fully understood the margin call but this post has been a good explainer. Now I understand why institutions sell crypto to cover their debt accruals.

Posted Using LeoFinance Beta

0
0
0.000