So the reason for capital flowing out of the crypto market is being attributed to the rising rates of interest. Largely as a result of truth the price of borrowing cash is larger.
Additionally, it is generally accepted the 2021 bull market was all the way down to low-cost cash with low charges. The price of borrowing was virtually free so the capital flowed into crypto.
So my query.. Why is the price of borrowing a lot extra influential then return on funding in addition to the precept itself?
Instance: If i used to be investing $100 million right into a challenge, why is borrowing price extra influential then 1) the precise preservation of the 100m and a couple of) anticipated return- if it goes up 25% who cares whether or not the borrowing price is 1% or 5%??
Additionally, if the challenge is not stable who cares about APY of you unfastened 50 million on a dump?
Simply making an attempt to grasp the market behaviour