Cryptocurrency investors panicked Thursday as the value of cryptocurrencies, including bitcoin, plummeted, with some saying they would lose their homes as a result.
Cryptocurrency investors panicked Thursday as bitcoin plummeted to its lowest price in more than a year and other cryptocurrencies experienced even worse sales.
Victims of the bloodbath – which takes place in the midst of broader path of the stock market – ranging from billionaire cryptocurrency titans who run leading markets like Coinbase and Binance to small retail investors who poured their life savings into cryptocurrencies, the New York post reported.
“I lost over 450k usd, I can’t pay the bank,” reads one of the most important posts on the Reddit forum for Terra Luna, a cryptocurrency which has lost over 99% of its value in the past week.
“I will soon lose my home. I will become homeless. ”
“My former colleague attempted suicide,” reads another post up on the forum. “She basically moved all of his savings into cryptocurrencies in 2021 and LUNA was a major player in his portfolio.”
Another user wrote: “It seems unreal, I can’t believe this is happening, I practically lost 60,000 overnight with what could have been considered a risk-off asset for 3 days and I can’t help it. I can’t sell, I can’t buy, I can only watch it burn. This is crazy. What the fuck is true. “
While the Moon crash is the most spectacular, other cryptocurrencies are also in free fall.
On Thursday afternoon, Bitcoin was trading at around $ 28,300 ($ 41,200), down 20% from last week and nearly 60% lower than its all-time high of $ 69,000 ($ 100,000) in November 2021. Other major cryptocurrencies, including ethereum and solana, are now worth fractions of their all-time highs.
The entire cryptocurrency market now has a market cap of $ 1.2 trillion, less than half of the $ 2.9 trillion it was worth in November, according to data from CoinMarketCap.
“There are a lot of people out there who have had real bruises.” said Garrick Hileman, head of research at Blockchain.com. “In cryptocurrencies, the strong survive and the weak get flushed.”
The ongoing route provides fuel to detractors who have long argued that decentralized digital currencies were a frothy fad fueled by low interest rates and pandemic-era stimulus controls.
Prominent cryptocurrency critics include Jamie Dimon, head of JPMorgan Chase, who once said bitcoin is “worthless”, as well as executives of billionaire Berkshire Hathaway. Warren Buffett and Charlie Munger.
98-year-old Munger recently called cryptocurrencies a “venereal disease” that he was “proud” to have avoided. Shares of Berkshire Hathaway have risen 5.6% over the past six months, while bitcoin is down 56%.
The cryptocurrency crash comes as the Federal Reserve raises interest rates in an effort to cool inflation, sending high-risk tech stocks into a tailspin. The tech-rich Nasdaq composite index fell 30% this year and has been heavily correlated with the price of bitcoin in recent weeks, according to Refinitiv data.
“We see more ownership overlaps than ever, this kind of convergence between Wall Street and cryptocurrencies,” said Hileman, who is also a visiting fellow at the London School of Economics.
Investors who invested their money in trendy tech stocks took a beating alongside cryptocurrency fanatics.
“I Need Help: EVERYTHING LOST in the Stock Market,” reads a popular post on the Blind corporate bulletin board. “I have invested every last dollar I have saved in the stock market and are currently down by nearly 85 percent.”
The self-identified 29-year-old corporate employee of Home Depot said he primarily owns shares in tech companies including Meta, Peloton and Spotify.
“They all screwed up the bed,” the clerk raged. “Same with cryptocurrencies.”
Bitcoin’s crash is likely to scare some of the retail investors who poured money into cryptocurrencies during its stimulus wave, while potentially attracting those hoping to buy the drop, according to Bitcoin IRA’s Chris Kline.
“It takes tourists away from true believers,” said Kline, who is the COO and co-founder of the cryptocurrency retirement investment site with 100,000 users. “There will be people who will say, you know what, cryptocurrencies are not for me. But there will probably be just as many new people entering the market ”.
Shares of Coinbase, the only major publicly traded cryptocurrency exchange, have fallen 84% since the company went public in April 2021. The company on Wednesday warned customers that their cryptocurrency holdings could be a risk if Coinbase goes bankrupt, even though CEO Brian Armstrong insisted that bankruptcy isn’t in the cards.
Although Hileman is optimistic about the long-term outlook for cryptocurrencies, he said the current recession shows amateur investors need to be careful.
“I feel for anyone who has been severely beaten by what’s going on,” he said. “It shouldn’t take you longer than you can afford to lose.”
This story first appeared on the New York post and has been republished here with permission
Originally published as Cryptocurrency Investors Panic During Market Bloodbath: “I Will Lose My Home”