It’s not news that the cryptocurrency market is having a very tough year. This is with the market capitalization losing over $2 trillion. Ultimately, losing its trillion-dollar status. Bitcoin, which was once a trillion-dollar asset class, ranking among the top 10 asset classes in the world. Which was alongside legacy asset classes like Gold, Apple, Saudi Aramco and Amazon, has lost over 60% of its value Year-to-Date (YtD). Currently they now rank#18, with a market capitalization of $362 billion, a point not seen since November 2020.
June 13 stood out to be a particularly tough day for the market, with major tokens shedding more than 10%. Bitcoin, the market leader, broke below its $20,000 support level. Therefore, signaling a capitulation that saw a total liquidation of approximately $8 billion in June alone. Ether, the smart contract flagbearer, is down more than 70% in 2022. And also many more coins and tokens have fared worse.
However, over $2 trillion in value has been wiped off the books since crypto’s market cap peak of nearly $3 trillion in November 2021. There have been insolvency issues at some crypto exchanges and hedge funds, namely Three Arrows Capital, and FTX CEO Sam Bankman-Fried.
This warned of more carnage on the horizon shortly after bailing out BlockFi and Voyager Digital with $750 million in credit lines. Even in the DeFi space, we saw Celsius, a crypto lending service company. This pause withdrawals as well as swap and transfer products. These issues acted as a catalyst and a big blow to the space. Which was built on decentralization and on the back of ease of entry and exit.
-Nairametrics.