What Caused the 2008 Financial Crisis: Crypto Investor Takeaways
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A recent liquidity crisis at the second-largest property developer in China has investors drawing parallels to the infamous 2008 financial crisis. This issues has raised investors’ concerns; that its effects may trickle down to the global economy. Evergrande, the infamous company, has fueled an economic spur in the country since 1996, but most of the growth sat atop unsustainable and ever-increasing debt. Today, the company has liabilities of over $305 billion, the largest debt of any business worldwide. Moreover, its real estate properties have low occupancy rates, which is reminiscent of the 2008 financial crisis.
The Chinese government says they’ve got things under control. At the same time, strategists recommend that Beijing acts promptly because Evergrande’s decline is hurting market sentiment, even spreading to crypto by causing Bitcoin to drop over 5% before rebounding.
In this guide, we discuss what caused the 2008 financial crisis and how savvy crypto investors can learn from the economic uncertainty in the market.