Bretom wrote:
A few months ago I watched with stupefaction as the rouble lost more than 50% of its value in 3 weeks. It's now trading higher than it was pre-invasion. I know the situations are barely comparable but it was a reminder that big movements almost always have an emotional component and very often that emotional component gets corrected over time. I'm not convinced there's an easy answer to what "correct" means w/r/t to crypto, but I'm tempted to have a flutter for the first time.
If one of the larger exchanges goes, which means that a bunch of people are going to lose lots of their crypto on that exchange, it could cause lots of people to realize that these exchanges are not actually going to protect them like any regulated financial institution. People are going to sell to protect their money, which will drive prices down even more. Then we have an old fashion bank run as people exit before they lose everything.
You are right that emotions have a huge impact on market prices. But crypto requires a constant stream of new buyers, if not the miners can’t cash out and pay their bills. The ruble just needs a 1 to 1 exchange for buyers and sellers, not constant new blood.