Ethereum, Bitcoin, take huge price hits; should you be worried? Frank Holmes gives analysis

(Kitco News) – Volatility is constructed into the “DNA” of cryptocurrencies; buyers and merchants shouldn’t fear concerning the worth drops earlier this week, stated Frank Holmes, government chairman of HIVE Blockchain Applied sciences.

Talking on Ethereum and DeFi, Holmes stated “I believe that this can be a phenomenal business, and there is going to be many new derivatives come from it, and it has nothing however blue sky, however extraordinarily unstable.”

Holmes stated that buyers ought to perceive that volatility is regular for the crypto house.

“I believe we have seen this unimaginable volatility when one thing is disruptive. Take into consideration Tesla. Tesla has the identical DNA of volatility as Bitcoin and Ethereum. The truth is, Ethereum is extra unstable than Bitcoin, like silver is extra volatiles than gold. Each time one thing is disruptive, like when digital cash is coming into the market in full throttle this final 12 months, it may have all these naysayers and early adopters,” he stated.

Holmes’ remark come as Ethereum tumbled practically 25% from its highs on February 18, with Bitcoin falling 20% from its February 21 excessive.

Cryptocurrencies aren’t new to “flash crashes”, Holmes stated.

“This flash crash in Ethereum occurred a 12 months in the past when Ethereum surged to $300, fell to $100, got here proper again as much as $200, and form of went sideways earlier than it went onto these different ranges,” he stated.