Question #87 ·
Why did a global equity market slump lead to a drop in Bitcoin’s market cap?
- Because Bitcoin mining rewards were halved causing supply constraints price decline
- Because investors liquidated crypto holdings to cover losses in equity markets Right answer
- Because regulatory changes banned crypto derivatives trading reducing overall market participation
- Because traders increased Bitcoin margin positions expecting further quick market stabilization
Why is this the correct answer?
This is correct because a slump in the global equity market often forces investors to cover losses by selling off other assets, including Bitcoin. Beginners should note that in downturns, investors liquidate holdings broadly, leading to a drop in Bitcoin’s market capitalization as funds flow back into cash or safer assets.