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Ethereum passes through a critical period and a decline in 20 % could cause $ 336 million on the defi market. With key levels for monitoring and increased volatility, investors must be prepared. Risk analysis, adaptation strategies and solutions to protect your crypto portfolio in the face of this threat.
Ethereum can lose 20% of its value and cause a real tidal wave
Massive liquidation is often synonymous with high volatility and snow ball to the market. When long long positions are disposed of, this emphasizes the pressure that can still reduce the price of the Ethereum and cause new disposal. This phenomenon, known to traders has been caused by several brutal CRAs in the past, especially in 2021 and 2022.
According to Kevin Rush, the founder of the Raac Loan platform platform, the Ethereum drop to $ 1,857 would cause $ 136 million liquidation, while a $ 1,780 decrease would cause another $ 117. The worst scenario? A drop in $ 20 % to $ 1,500 that can dispose of $ 336 million in Defi loans. This crisis would be driven by a loan of $ 130 million supported ETH in the sky (a former manufacturer).
If ETH drops as low, what to do?
Can the question of the spirit of investors: can Ethereum really fall by 20 %? Taking into account the recent market development, several factors could be played. Macroeconomic uncertainty, a decrease in liquidity on the markets of markets and the lack of enthusiasm of investors in the face of current regulations are all the elements to be monitored.
However, in order to alleviate this volatility Ethereum, the integration of real assets such as real estate and gold in defi could offer a more stable alternative to investors. These assets, less subject to extreme fluctuations, would allow portfolios to be diversified and reduce the cascade disposal due to excessive lever effect.
Ethereum is therefore currently under supervision. Will it resist pressure or dive towards new stockings? Crypto traders must then prepare for possible increased volatility and adjust their strategies to avoid the wrong side of the market.
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The world is evolving and adaptation is the best weapon that survives in this undulating universe. I am interested in everything about blockchain and its derivatives. To share my experience and promote an area that fascinates me, nothing better than writing informative and relaxed articles simultaneously.
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The words and opinions expressed in this article are involved only by their author and should not be considered investment counseling. Do your own research before any investment decision.