Does the rise and fall of the cryptocurrency market really scare people to death?
You have 10,000 Luna, and while you were sleeping yesterday, it was worth 1 million USD. When you wake up, it has turned into 700,000 USD. You think to yourself, having been in the cryptocurrency world for so long, a mere 30% retracement is nothing; UST has only depegged by 10%. I believe in Do Kwon, so you sleep soundly again.
The next day, you wake up and it has dropped to 10,000 USD. At this point, you're thinking it has fallen 99%, so it shouldn't drop any further, right? If I buy in now and it rises to 10 USD, that's ten times my investment, how wonderful! So you sell everything you have and gather another 200,000 USD to buy 200,000 Luna, but now you can't sleep.
You watch the price constantly, hoping it will rise back up, but all you can do is watch as the price drops from 1 to 0.1 all the way to 0.000001, and finally gets delisted. In just three days, your 1.2 million USD asset has shrunk into the money for a breakfast. You are completely devastated.
Besides Luna, the cryptocurrency market differs greatly from traditional financial markets:
1. Open 7*24 hours without rest;
2. No price limits;
3. Very low entry barriers;
4. A vast number of people abusing leverage;
5. Altcoins have no limits to their price fluctuations.
Especially when points three, four, and five come together, becoming rich one night and going bankrupt the next is quite normal. Use leverage with caution, everyone; you may think that a five-times leverage is low, but you don’t realize that there are days with more than 20% volatility every year.
Because of leverage, the more it falls, the harder it is to stop the decline, ultimately leading to a chain reaction of liquidations.
Sui Sol LTC ETH
