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Trend cycles are never constant. They continue to change and improve over time. Numerous stories in the crypto market, such as “buy the dip” and “HODL,” have lately transformed into cyclic patterns and garnered significant traction.
A recent Bank of International Settlements (BIS) paper identified several emerging trends exhibited by the market and its participants. The first and most interesting trend highlighted was the change in HODLing patterns. Arguably, for any market to grow, existing investors need to be retained.
IntoTheBlock’s data weaved a complementing narrative. HODLers have, by and large, been outnumbering and dominating other participants like the cruisers and traders over the past few months. The report further claimed that crypto markets might stabilize with time, if HODLing becomes even more pervasive. What’s more, the BIS’ paper asserted,
“Those who invested in cryptocurrencies in the past are likely to remain invested.”
Next, the report contended that cryptocurrency ownership had nothing to do with the “distrust” in fiat currencies. They further emphasised that cryptos like Bitcoin did not pose any threat to traditional financial tools. The report noted,
“Cryptocurrencies are not sought as an alternative to fiat currencies or regulated finance, bur are instead a niche digital speculation object.”
It should be emphasised, however, that crypto supporters are adamant that this new digital monetary version will eventually replace fiat currencies once and for all. Dan Held of Kraken Exchange, for example, recently predicted that Bitcoin will become the world’s reserve currency within the next ten years.
The report also claimed that restrictions will “benefit” the cryptocurrency sector as a whole. In reality, most of the major regulatory organisations have already begun to operate in this direction. For example, Congressman Bill Foster recently acknowledged the importance of a crypto regulatory system. He believes that other parties, such as courts, should be permitted to enter the ecosystem via a “cryptographic back door” in order to safeguard the industry against ransomware assaults. BIS stated,
“A clarifying regulatory and supervisory framework for cryptocurrency markets may be beneficial for the industry.”
Toward the end of the study, the report also highlighted the connection between education level and crypto investment decisions. According to the overall tendency, cryptocurrency owners are “generally more educated than the average.” A further division is proposed,
“Among the various cryptocurrencies, owners of XRP and Ether are the most educated, while those owning Litecoin are the least educated, with Bitcoin owners ranking in the middle.”