Ordinary people's investment choices mainly fall into two paths—buying a house or allocating to crypto assets. But have you noticed an interesting phenomenon: when crypto assets drop by 30%, the market remains calm; when housing prices fall by 30%, it feels like the sky is falling. What's really behind this?

The issue actually lies in the use of leverage. Most people only put 30% down when buying a house, borrowing the rest from the bank, which means 1 dollar of capital can leverage 3-4 dollars of business. When housing prices drop by 30%, the down payment is wiped out, and instead, they owe a large debt to the bank. But retail investors in crypto usually don't use leverage or use very low leverage, so even with large declines, they won't be forcibly liquidated.

There's also the liquidity issue. Crypto assets can be sold at will; if you're really losing money, you can cut losses and exit the same day. Houses? They sit on the market for months, especially in areas where prices have halved. Owners are anxious and desperate, but no one is willing to buy, so they have to keep paying the mortgage.

The key difference lies in asset allocation. Many Chinese families have 70% of their savings tied up in their house, with the remaining 30% spread across bank deposits and other investments. If the house price wobbles, the entire family’s finances shake. But crypto assets are different; most people play with spare money, so even if they lose, their mentality isn't as shattered.

When you connect these four dimensions, you'll understand why a 30% decline triggers vastly different market reactions.