In the financial system, people have a bunch of different asset types to own according to the paradigm of the era that they are in. When we consider the sources that feed the price of gold, we clearly see that global risks push people into buying more golds to secure their purchasing power. 

![global risks and crypto ecosystem relationship bitcoin ethereum.png](https://images.hive.blog/DQmW4rn3w7UBptesF76n5PAqKVgrfAhMScUWSAY4AtfpL4e/global%20risks%20and%20crypto%20ecosystem%20relationship%20bitcoin%20ethereum.png)

Even though there are several examples that we can discuss, recent years showed that a mild degree of global risks push people convert their fiat currencies into **USD** and high level of risks bring increase in price of Gold, Silver and precious metals. 

If we consider the crypto ecosystem, how do people reach to the global risks in crypto ecosystem?

### Bitcoin = Digital Gold vs Speculative Asset
It is nearly acknowledged by the majority of the crypto investors that Bitcoin is not the best blockchain to be used for daily operations, smart contract or high-speed txs.

However, Bitcoin had some days in which it could preserve its value while the markets were shaking. *Now that it has potential to be a secure place for investors in some cases, why does it crash these days?*

#### Already Overpriced Crypto Market
Yeah, I'm also one of those who never feel satisfied with the prices of Bitcoin, Ethereum, Hive and other beloved projects. Yet, when you compare the prices with 365 day before, we can clearly see that the market has already been quite profitable and it is likely to be left by people **to reduce the amount of risky assets** or **to take profit**.

Fundamentally, cryptocurrencies are still risky assets in the eyes of people since the technology behind is too complicated for many people. Having the title of "risky assets" on them, it would not be likely for cryptocurrencies to survive in the **global inflation** and **the risk of war** scenarios. 

### Risks are already Unbearable 
A couple of days ago, we had phishing case of [OpenSea](https://www.bloomberg.com/news/articles/2022-02-20/opensea-probes-nft-phishing-attack-co-founder-says) and we are already in a deep global inflation. If we add the risks from the war and economic sanctions between governments, I think it would not be fair to judge cryptocurrencies for being too much speculative. 

*Note: The pandemic lost its reputation. Thus, I do not even mention it.*

The risks become a part of our lives. I cannot imagine a day in the "new world" (after pandemic) but that amount of risk is more than enough for an ecosystem that has just been thriving.

![low price and high price bitcoin crypto currencies.png](https://images.hive.blog/DQmSWZ97YfzYbrJ5vTLhAfDj6cmV6HNMoJo7qAzxDUPKQGo/low%20price%20and%20high%20price%20bitcoin%20crypto%20currencies.png)

### If (low) -> Pump ; If (high) -> dump
I'm not concerned about the red days that we are experiencing. Even though I do not take profit from my main portfolio, it is fine to me to see lower levels before we start another bull-run (maybe Mega Bull-run).

While Bitcoin was about $5k in the first times of pandemic, it could skyrocket with all other cryptocurrencies. However, the pandemic made people stay home and trade crypto even if it was their first time. So, there were some other reasons that pushed the prices higher.

On the other hand, the inflation is expected to effect the crypto ecosystem in a positive way like precious metals. I believe it will eventually happen but we may not see these days in the short period of time.

For crypto ecosystem to go up, the cease of bank account cases in Canada and sanctions may provide nice narratives to accelerate mass-adoption. I believe all these good thing will happen when the crypto in on discount 🤏 


### TL;DR
Crypto ecosystem has not clear cut reactions to global problems like Gold, Silver and other precious metals. Though Bitcoin and other cryptocurrencies could perform successfully in some risky times, they are not capable of preserving their value in todays' global conditions.

The high prices (compared to last year's performance), the outlook that "risky assets" by many people and too much pressure from risks (War, Inflation, OpenSea Phishing etc.) may trigger a deep dive in crypto ecosystem. Yet, nothing will stay negative when the prices become too juicy and the risks settle down as the time passes.

The year 2022 cannot end without a new ATH regardless of conditions 🔥 

Posted Using [LeoFinance <sup>Beta</sup>](https://leofinance.io/@idiosyncratic1/relationship-between-global-risks-and-crypto)