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The European Central Bank Predicts Crypto Crash, Cryptocurrencies Will Crash, But Why?



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Is a crypto crash coming in 2021? Crypto crash what happens next!

Why the ECB predicts a possible market crash in cryptocurrencies

The European Central Bank (ECB) has included the purchase of cryptocurrencies among other "pillars" that could exacerbate possible financial market downturns if economic recovery plans fail to meet expectations.

This warning is part of the ECB's monthly financial stability review released in November and published on Wednesday.

According to the report, investors are pursuing investment routes that promise significantly higher returns due to falling interest rates and rising inflation.

This trend, according to the ECB, has led to an increase in investment activity in market segments such as cryptocurrencies, junk bonds and housing.

The ECB said such a situation could cause problems, especially if there are abrupt changes in global liquidity conditions.

"A correction in the markets could be caused by a weaker-than-expected economic recovery, leaks from adverse developments in emerging market economies, a resurgence of stress in the non-financial corporate sector or a sharp adjustment in market expectations about the outlook. monetary policy, "the ECB said in a report.

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