“Grab Your Faith and stick to it. The advice, released Tuesday by the hosts of popular cryptocurrency podcast Bankless, Ryan Sean Adams and David Hoffman, outlines the mindset that prevails in cryptocurrency circles today.
Crypto is in a bad place. In the past 7 days, the price of Bitcoin has fallen by more than 29%, while Ethereum has lost 38%, and basically all other cryptocurrencies are not far behind. According to cryptocurrency data provider Coinmarketcap, the total value of the cryptocurrency market has fallen by about 70% from its November 2021 high, when the rise and rise of cryptocurrencies and Web3 looked unstoppable. The Tether stablecoin, a cryptocurrency designed to be parity with the U.S. dollar and purportedly backed by U.S. dollar reserves (despite questions about what those reserves constitute), has lost its peg and is trading at 99 cents at the time of writing. Major cryptocurrency companies have announced massive layoffs, starting with the exchange Coinbase. The latest victim of the cryptocurrency crisis is Celsius, a lending platform that, according to insights firm Kaiko, has invested $475 million in customer funds in stETH — a leading cryptocurrency that could theoretically be redeemed at some point in the future. Synthetic assets for the cryptocurrency Ethereum. This sent shockwaves across the industry following the debacle of stablecoin terra-luna last month. The S&P 500 fell 3.5% on Monday, while the Nasdaq fell a further 4.2%.
If you’re one of the 16% of Americans who have bought cryptocurrencies in the past few years, this might seem like an opportune time to start frantic. But among crypto space heavyweights, common reactions to this decline range from zen to bland.One meme The handle, posted on Bankless’ Twitter, features a noose-wearing James Franco at the gallows — who was a stand-in for the 2018 crypto crash — asking if the two crypto holders, who will cry from 2022, are Their “first time” there.One less charitable memes Shared by Twitter crypto skeptics, comparing confident crypto investors to a quiet dog sipping coffee in a burning shed. “That’s fine,” said the dog, and the flames threatened to engulf it. This too will pass.
“If you look at the fundamentals — blockchain adoption, user expansion, mining of real use cases, you don’t think the industry is in decline,” said Justin Grenada, Grenada’s ambassador to the WTO and founder of the WTO. Justin Sun said the TRON blockchain, whose stablecoin usdd also lost its peg to the U.S. dollar last week. “The market is full of FUD [fear uncertainty and doubt] now, broken [terra-luna] The recent bankruptcy of some DeFi platforms and funds doesn’t help either, but I believe in rational expectations that the market will correct itself. There have always been cycles, and we are sitting on the slippery slope of the current cycle. “
Speaking last week, Tether’s CTO, Paolo Ardoino, found a silver lining in the crisis, at least when it comes to Bitcoin. “Bitcoin may have proven to be stronger and less volatile than other coins. Bitcoin is down 60% — but other altcoins are down a lot more than that. So Bitcoin is showing more resilience,” Ardoino said . “We may see a situation where Bitcoin starts to rally in the coming months while the rest of the ‘alt-coins’ remain down.”
However, the big thing in the room is that cryptocurrencies — often touted as a hedge against inflation and the vagaries of the financial system — behave exactly like the rest of the stock market. Ardoino himself compared Bitcoin’s misfortune to the recent disastrous performance of Netflix stock, which fell 40% in one day in April due to disappointing subscriber numbers.