Crypto investors are at the point where they are wondering just how bad the current cryptocurrency market crash can be. Even bitcoin has now lost its major support– it could be headed down to around 20k.
Only around 7 months ago, crypto was riding strong. The combined market cap for this new asset class had just tipped $3 trillion. We can say perhaps a third of the gold market. Moreover, the technology that crypto brought with it was seen as groundbreaking. Perhaps every bit as disruptive as when the internet came along.
In addition, seven months later, the whole cryptocurrency industry, including crypto-investors, is heading downwards in price at breakneck speed. The velocity of the collapse has been such that it has caught many by surprise. Further, it has included the large investment companies that were backing. So, many of the projects within the crypto industry.
Crypto Investors are Losing the Trust in the Other Coins
Bitcoin, the granddaddy of cryptos and the one that has probably held up better than any other, started its rapid descent only a week ago. In just 7 days, the asset has plunged from $48,000 to its current price level of around $28,000 at the time of writing. Further, it has been as low as under $27,000 earlier today.
Losing $20,000 per bitcoin in just a week sounds pretty bad. However, the worst disaster for the cryptocurrency sector has undoubtedly been the total and utter collapse of the UST stablecoin.
UST is currently hovering at around 55 cents, while LUNA has plummeted from $97 to 5 cents in just 3 days. It is wiping off many billions from the portfolios of the institutions and retail investors who were backing the ecosystem.
Absorbing such a loss will arguably take crypto a long time to achieve. Also, it has accelerated the bearish momentum across the entire industry. How far down we go from here is anyone’s guess…
What is required now is to start making a recovery for the stock market. Given the current geopolitical tensions and the weakness of the global economy in general, things are looking increasingly uncertain.
Institutions and Crypto Investors are said to be relishing the thought of bitcoin going down to sub $20k levels so that they can “buy the dip”.
Surely a wipe-out era for the average retail investor. Even many may be limping away from this particular car crash for good.
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