In the blink of an eye, over a trillion dollars worth of cryptocurrency market value has evaporated. The sharp decline that has characterized digital assets in recent weeks has continued into Saturday, with bitcoin losing more than 15 percent at one point.
The coin, which is the largest digital token, is down more than 50 percent from highs, and many other cryptocurrencies have lost as much, if not more.
The carnage has been harrowing for digital asset investors: Friday’s crash led to the liquidation of more than $1.1 billion in crypto futures positions, and in total more than $1 trillion in market value has been liquidated. from the last peak.
In other words, the collapse is adding salt to an already deep wound. “Digital currency markets as a whole have been very challenged this month,” he says. Jonathan Padilla, co-founder of Snickerdoodle Labs, a blockchain company focused on data privacy. “There’s definitely some pain there.”
Being an investor is difficult right now
Even the most optimistic investors are beginning to wonder when the beating will end. The famous crypto investor Mike
Novogratz he reflected on Twitter that “this will be a year where people realize that being an investor is a tough job.”
But, cryptocurrency investors have an endless dose of optimism and many are confident that, with bitcoin already spending two-thirds of the year in the red, better times are approaching.
At some point, they insist, the sellers will dry up and the market could soon capitulate, he said. Matt Maley, chief market strategist at Miller Tabak + Co.
Cryptocurrencies are not going away
“When that happens, institutions will come back in significantly,” he added. “Once they know that cryptocurrencies are not going to go away, so they will have to get back into it before long.”
The news cycle has been relentless. regulators of Russia, the United Kingdom, Singapore and Spain announced interventions that
that could undermine crypto firms looking to grow in those regions, while tightening US monetary policy had traders anticipating several interest rate hikes this year.
Meanwhile, the Biden administration is preparing to publish a strategy on digital assets next month and will task federal agencies with assessing the risks and opportunities they pose, according to people familiar with the matter.
with the matter. This weighed on bitcoin enough to send it to $34,000 on Saturday.
Bitcoin’s slide from its November high has wiped roughly $600 billion off the market.