The currency market has experienced a series of heavy losses in the past week. Bitcoin fell by nearly 10%, Ethereum by 9%, SOL by 11%, and Dogecoin by 9.4%. The continuous decline in virtual currency market has led to shrinking assets and repeated explosions of positions. Investors in the currency circle are vocal about the arrival of a bear market. However, this does not affect the business of the exchanges. It is noted that exchanges are still inviting users to follow trading orders. Despite looking like a “money-making” transaction, it is risky behind the dramatic price fluctuations.
From June 20th to June 25th, the price of Bitcoin dropped from a high of $66,000 to below $60,000. By June 26th, the price had rebounded slightly to $61,328, a 0.27% decrease in 24 hours and a 5.39% decrease in a week, and a high of 9.55% in nearly a month. Bitcoin’s violent plunge has also affected other digital currencies. Ethereum fell by 10.27% in a month, SOL fell by 2.36% in a week and over 18.59% in a month, and Dogecoin plummeted by a high of 22.66% in a month.
The sharp decline in Bitcoin and the virtual currency market is the result of various factors. The uncertainty of the global macroeconomic environment and the volatility of the financial market directly impact the virtual currency market. In addition, technical factors within the market are equally important. The continuous breaking of key support levels by Bitcoin in the short term has led to a large number of stop-loss orders, intensifying the decline in prices. The massive selling behavior of large coin holders has also caused a chain reaction, triggering more small and medium-sized investors to follow suit.
Despite the continuous decline in prices, the market still attracts speculators. Recently, Binance has frequently invited users to follow trading orders, claiming that participants can share 30,000 USDT through simulated trading competitions. Such follow-up trading activities are risky and may lead to blind following of market fluctuations. Therefore, investors should exercise caution.
Apart from the risks associated with following orders, investors also need to be vigilant about other issues in the virtual currency market, such as market manipulation risk and security risk. It is an irreversible trend for the market to mainstream, standardize, and institutionalize. However, any virtual currency-related business activities in China still remain illegal financial activities.
In conclusion, it is crucial for investors to increase their risk awareness. They should fully understand the high volatility and uncertainty of the market to avoid blind pursuit and excessive leverage operations.