Crypto markets are undergoing a severe lack of investors’ trust and streamlined liquidity flow due to recent developments. This poor performance of the cryptocurrency market is commonly referred to as crypto winter and can last for a specific period of time before the market returns to its routine value.
Crypto winters can be disastrous for new blockchain startups as new funding almost freezes with investors moving away from the ecosystem. Due to this reason, it becomes extremely hard for blockchain startups to survive the crypto winter.
Due to the high uncertainty in the market, every project has to undergo a tough time, creating the perfect conditions for rumors to spread around. In this CoinGabbar blog, we will cover the impacts of rumors on the crypto space and understand how it can be fatal for new projects trying to survive in this crypto winter.
Increasing Rumours Amidst This Crypto Winter
As the cryptocurrency industry has grown to become a leading pillar of decentralized finance, the media around it has also prospered at a rapid pace. Every piece of information in the crypto domain spreads like wildfire because of the highly active community and the great interest of news agencies in the crypto market. The news mechanism has developed to be so swift that even rumors are entertained wildly by the community.
Even at the slightest hints of any mishappening and the blockchain experts draw whole stories themselves, creating a panic situation across the crypto space. Cryptocurrencies are relatively new and thus market volatility is a serious issue that makes sensational headlines. Every new development comes with the hope that it will pump the market or the fear that it will push the market down. The reliance of cryptocurrency markets on the sentiment of social media users becomes another important reason for the media to be so effective in cryptocurrency markets.
From one to another, we witnessed a series of events that were highly influenced by speculations and rumors. Most of them were nothing but short-lived rumors but some of them turned out to be true and became the reason for sizeable market endeavors.
What is FUD? Why Should Be You Beware of it?
FUD or Fear, Uncertainty, and Doubt are one of the most critical aspects that drive the market based on the sentiment of the investors. This is also a tactic used by marketers effectively to create a sense of panic in the space and pace up the decision-making of their target audience without asking for too much information about the product.
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If you are contemplating playing the virtual currency game, but you haven’t heard of the cryptocurrency thing, the first question that would come to mind is Bitcoin!
