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smabie · 2021-02-26 05:30:02+00:00

Ehh, sort of. Volume is highly correlated with return due to the wealth affect. When crypto crashes people stop trading.

Jommi | karma 985 | avg karma 1.03 · | 2018-05-24 03:08:46+00:00

You're forgetting that the lower you go with a cryptocurrency the less volume it has. This will have a major effect on your profits.

muhneesh | karma 367 | avg karma 6.33 · | 2018-12-09 17:01:53

Crypto is a different ballgame than the stock market, given concentration of trading volumes in relatively few coins.

To the extent that the investment philosophy leans more towards "HODL" as prices decrease, trading volumes will go down, and trading volumes predicate volatility.

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puranjay | karma 1 | avg karma 0.0 · | 2022-06-02 17:47:19

Volume goes down, fees collected go down

Crypto trade volume collapses catastrophically in bear markets

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matheusmoreira | karma 22085 | avg karma 2.63 · | 2021-05-19 16:24:34+00:00

It's a crash on a traditional market such as stocks. On the cryptocurrency market, a real crash would result in figures in the -90% range.

chii | karma 16512 | avg karma 1.96 · | 2022-05-09 22:32:55

The implication is that when crypto goes sideways, trading volumes drop, and thus, even though spread might be same or even better, the volume drop will have lost them money.

plonk | karma 868 | avg karma 2.26 · | 2022-05-22 14:49:17

Cryptocurrencies have huge market caps though. If they crash (like the Luna disaster last week), that has to have some kind of impact, right?

leplen | karma 278 | avg karma 7.94 · | 2022-10-23 15:50:40

This article is 5 months old, and talks more about NFT trade volumes than NFT prices. Having volumes decline from peak speculation is more a sign of market maturity than a market crash.

steelstraw | karma 4514 | avg karma 12.13 · | 2022-01-24 11:06:17

In crypto, yes. There have been years (2014 - 2016, 2018 - 2020) where the market fell down and stayed flat.

jbkiv | karma 422 | avg karma 5.15 · | 2022-02-02 21:03:56

You have to compare that to the equivalent of the float in stocks. Most crypto holdings are not that liquid and come from early backers. If the big holders (mostly pump and dump) sell, the market will collapse.

biddit | karma 224 | avg karma 3.73 · | 2021-11-19 11:00:39

So this implies that the crypto markets are actually far less liquid than the trade volume implies. Suddenly those massive 10% +/- fluctuations in a day make a lot more sense.

PrivateLaws | karma 1 | avg karma 0.5 · | 2021-12-09 14:37:08

If the trend continues, it will. I keep a part of my crypto money in cash for when crashes happen.

fujipadam | karma 231 | avg karma 2.29 · | 2018-12-17 03:18:31+00:00

hmm none! The Cryptocurrency market is very unstable right now. This is different from usual stock market instability. When stock indices fall, given enough time they will bounce back. However, Crypto's very viability is in question so it is a very risky gamble.

That said, it all depends on your investment profile. Are you a big risk big reward person? Even if that is the case crypto's don't really offer high rewards for the high risk at this point in history

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anony23 | karma 135 | avg karma 1.39 · | 2022-07-26 07:57:33

While retail investors did lose money, crypto volumes are dominated by institutions.

jobigoud | karma 4124 | avg karma 1.83 · | 2021-04-03 02:56:36

Crypto crashing means a lot of people selling, hence a lot of trades, hence lots of money for CB.

jeffreyrogers | karma 10945 | avg karma 3.94 · | 2022-05-12 13:04:58

I doubt crypto is the driver. Seems more likely that institutional investors are pulling out of cryptos as inflation spikes. So crypto crash is an effect, not a cause.

FollowingTheDao | karma 1257 | avg karma 0.85 · | 2023-03-10 06:08:16

Uh, no. No one sold crypto, the market just crashed. That is like saying people made money when the down goes down 20%.

rapsey | karma 4717 | avg karma 2.77 · | 2021-10-17 23:48:57

In a general one. In a general crash everything tends to drop because everyone is selling assets to cover debts. I can't see crypto doing anything other than drop more than anything has ever dropped.

It would recover later probably if investor confidence is not completely destroyed. Because as we all know, the entire space is still completely without any real world use case and entirely useless other than speculation.

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Jensson | karma 10270 | avg karma 2.0 · | 2022-05-12 12:02:01

Do you think the stock market crash was due to a few whales trying to game the market as well? Both fell due to the same effect, people who invested their savings in index funds/crypto now wants top cash out, so they sell.

MrMan | karma 474 | avg karma 0.32 · | 2022-11-13 19:16:12

any risk assets losing a ton of value would minimize the wealth effect but a lot of crypto holders were hoarding their coins and not spending so maybe not that much