Ask HN: In simple terms, what caused the recent crash in crypto market? - stayaada
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nostrademons
Prices being too high to begin with.

It doesn't matter how useful crypto is (marginally, so far) or how much the
underlying infrastructure has improved in the last year (a lot). If prices are
rising at 10% per _day_ for a couple months - which is what they were doing
last December - then it's basically guaranteed that they're going to get ahead
of fundamental value. Realistically, the only way out of this situation is for
prices to fall by a lot, which is exactly what's been happening over the last
year.

Bitcoin has the same price now that it had in August 2017. It's actually done
about as well as the S&P 500 since June 2017, and a fair bit better since
Trump's inauguration (it's up about 300% since January 2017, while the S&P 500
is up about 20%). It's just that in the middle of that time period it had this
huge bubble, which just happens to be when most people heard about it and
bought in, so the median crypto investor is now down about 80%.

