Definition:
A bloodbath is a term used to describe an event where the majority of the currencies are rapidly reducing in price. This event is similar to a bear market; however, during a bloodbath, the price drops usually occur suddenly, with relatively larger percentage drops occurring across the market.
Explanation:
Bloodbaths are usually the result of extreme selling activity due to negative factors; this may include, but are not limited to:
- Negative cryptocurrency-related news
- Economic downturn
- Government regulations or restrictions
- Exchange hacks
Bloodbaths are accompanied by widespread pessimism, negative sentiment, and even panic. These types of events can usually last days or months depending on the reason for the market decline.
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