Media's Effect on the Cryptocurrency Market
![](https://steemitimages.com/DQmYhE51rPoNR2FZqxZxPwbc8BSgyoZtSJ5ms6Z6dnNG622/VIDEO_6.png)
Cryptocurrency market
I will be using the term Market several times, but let's clarify what it means. It probably means something different to you than it does to me. The definition really depends on the person. A trader, an Investor, a reporter, an enthusiast have completely different notions of what the market means. For the time being let's define it as :
All cryptocurrency assets that have a value based on what people think & it can be used as a unit of exchange.
Bear in mind that the cryptocurrency space is in it's infancy stages. It will most likely take years for it to mature and reach levels of wide penetration. It is also highly unregulated. People from anywhere in the world that have an internet connection can set up an account and buy / sell cryptocurrency. That leads to an unstable market. People can influence it with enough capital, manipulate the price to a desired state and sell for their gain a.k.a Pump & Dump.
Media Price expectations
The highest recorded price of the collective cryptocurrency market cap was 830B on Jan 7th 2018. Today Feb 3rd almost a month after that Huge market milestone we are sitting around 437B. What happened? 393B left the market in less than a month? It makes no sense! As I mentioned before this market is highly unregulated which makes people behave in irrational manners.
Mainstream media institutes were providing unprecedented confidence and sense of security for the crypto world to people. Headlines everywhere about Bitcoin, "Get Rich with Bitcoin?!", "Bitcoin to 20K!"...you can imagine the rest. It is natural for people to be interested, learn what Bitcoin & Cryptocurrency is about but more often than not people thought of it as "Get Rich Quick" Deal.
Pretend that you were back in Dec 1st 2017. Bitcoin's price is close to 10K and there are headlines everywhere. Imaginary price of 20K has been set as a feasible target and you invest believing that it can happen. Other people will believe that as well. They were a little late, but bought at 14K - there is still money to be made. Someone else bought at 17K. There's still Profit to be made! Everybody watches as the price skyrockets and the imaginary price of 20K becomes reality, WOO! Headlines such as "Bitcoin reached 20K, what's next?" everywhere.
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There seems to be an apparent correlation between those two charts. Maybe...the price was reached because people thought it would happen. After reaching the expected price point there was mass uncertainty. The price declined rapidly, people are selling to make profit. After that milestone was reached the media changed their strategy. A mix of bad news and mass hysteria led the media to a new imaginary low of 8K. Yesterday we sadly hit that point and we are recovering since then...
Behaviour
Regardless of whatever goals the media sets we should be trying to work around them. People were buying when the price was high and selling when the price was low. Victims of false expectations are inevitable with such a young market. Patience is the key. Do research before you invest into anything and and as always -the Golden rule of Cryptocurrency investing :
Only invest what you can afford to loose.
Don't forget that this is a repeating pattern of going Up & Down. If we are currently going down...what do you think is going to happen next?
Let me know what you think in the comments down below!
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