Cryptocurrency experts name the key factors that caused the fall of the crypto market

Bitcoin BTC $68,197.10 Mezo Wrapped BTC -0.80% Market capitalization $38.66 million VOL. 24 hours $0.97 billion is trading almost 50% below its all-time high set just four months ago. According to Matt Hougan, Chief Investment Officer at Bitwise, the crypto market never has a single cause, as several factors are always at work simultaneously.

The expert identifies six key factors. First, long-term investors sold assets to get ahead of the traditional four-year cycle. It is estimated that more than $ 100 billion of BTC was sold last year. Second, investors' attention shifted to artificial intelligence and precious metals.

Other factors include the historic wave of leveraged liquidations on October 10, uncertainty over Fed leadership, concerns about the risks of quantum computing, and a general macroeconomic risk-off mood.

He notes that the decline may continue. Previous corrections were deeper than the current 54% decline and lasted 12−13 months. Bitwise’s internal models show that the probability of a bottom is increasing, but there are no guarantees.

At the same time, Howan emphasizes that cryptocurrencies have become a more mature asset class. Potential catalysts for the recovery could include regulatory progress (e.g., the Clarity Act), a return of interest in risky assets, advances in quantum technology, expectations of lower rates, and new breakthroughs in the crypto industry related to the development of artificial intelligence.