During extreme volatility, crypto market makers widen their bid-ask spreads significantly to manage inventory risk, reduce their quoted size on order books, and may temporarily pull out of certain illiquid pairs altogether to avoid being caught on the wrong side of a rapid move, prioritizing survival over profitability.
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Nasdaq's technology selloffs often trigger crypto declines through shared risk-on sentiment and overlapping investor bases between the asset classes.
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Macroeconomic factors like interest rates, inflation, and GDP growth can impact the crypto market. High - interest rates may make traditional assets more attractive, while inflation may drive investors to crypto as a hedge. How can investors factor in macroeconomic trends into their crypto investment research?
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