The cryptocurrency market has, in the last 24 hours, suffered massive liquidation as a result of macroeconomic uncertainties surrounding trade tariffs. As per CoinGlass data, the crypto market registered a loss of $19.38 billion within this period as prices of assets nosedived to unexpected lows.
Crypto market faces $19 billion liquidation amid tariff tensions
Despite these staggering liquidation numbers, Real Vision founder Raoul Pal has dismissed the market reaction as "all noise." According to him, most of the reaction is coming from short-term traders who possibly traded using leveraged positions.
This could greatly impact their funds and count as losses to them, given how low most assets dropped. The crypto market shed 9.18% within this time frame because of the bullish nature of the market before the trade tariff announcement.
Many investors were positive that the "Uptober rally" would linger and had borrowed funds to increase their position.
However, Raoul Pal maintained that for long-term investors trading with their own capital, the market volatility does not matter. In the long run, it will not affect their investment outcomes. For Pal, tomorrow will always be more digital than today, and as such, digital assets like Bitcoin (BTC), Ethereum (ETH) and XRP will always have relevance.
All of this is noise if you don't use leverage.
There are only 2 questions you need to ask as a long term holder:
Will tomorrow be more digital than today?
Has the liquidity cycle and business cycle topped or is it still rising to finance the $10trn that needs to roll in the…
He believes the world will continue to get more digitalized and that artificial intelligence (AI) and blockchain technology are required for financial transactions. Additionally, the liquidity cycle remains on an upward trajectory.
Pal insists that if central banks and governments continue to increase liquidity, the crypto market will be supported, as about $10 trillion needs to roll in within the next 12 months.
The market analyst urged real investors to think long-term and ignore the current liquidation noise. He advised players in the sector to buy the dip and accumulate more with this price drop. Pal emphasized that in the next five years, these will not matter.
Prices drop as investors "buy dip"
The liquidation has caused a setback in the price of major assets, with Bitcoin losing 7.86% of its value to change hands at $112,104.11 as of this writing. However, the volume has soared by 167.15% to $198.04 billion, indicating that market participants are treating it as a buy opportunity.
Similarly, Ethereum was exchanging at $3,824.05, a 12% decline within the same time frame. XRP followed the trend, losing 12.06% to trade at $2.48.
Market participants remain optimistic that the volatility will give way to stability and recovery in a matter of time.
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