Luna crash and bitcoin crash (BTC): deprivation, despair or healthy purge?

Amateur cryptocurrency investors panicked last May when bitcoin (BTC) hit its lowest price in more than a year. Some cryptocurrencies have suffered even greater declines and sometimes there is some devastation and despair caused by the Terra (Luna) crash.

The victims of this crash are among the crypto-billionaires at the head of major exchanges like Coinbase or Gemini, but also of course among simple retail investors. If there is nothing to worry about for the first one, on the other hand, sometimes they are in very difficult financial circumstances.

Terra Crash (Luna)

The signal had risen and attracted many investors and then came the drama: the crash, the crash, the crash, the demise. This unexpected brutal collapse had dire consequences: several ruins, even suicide (like this young Taiwanese who would have lost 2 million dollars). Without warning, some investors invested everything they had in this sign, ignoring the slogan “Only invest what you can afford to lose.” »

If the accident of Luna most amazingly, other cryptocurrencies are in freefall too. Bitcoin (BTC) is much higher than the record high of $ 69,000 since November 2021. Other major cryptocurrencies, including ethereum (ETH) and solana (SOL), are now worth fractions of their all-time highs.

Diligence of first time investors

Seasoned investors know it well, bitcoin (BTC) has already been declared dead many times already and its volatility is almost a matter of habit. On the other hand, first-time investors who were admitted to the greed teams suffered the full pressure of the downturn in the markets. But previous cycles, exit scams and other ponzi pyramids follow each other and like each other.

These turpitudes are not specific to cryptocurrencies, but to the whole world of finance. In this regard, we could cite Bernard Madoff (sentenced to 150 years in prison for embezzled not less than 65 billion dollars) or even Natixis, which destroyed a good number of small savers (in 2006, when it listed on the stock market., worth 19.55 euros, 2021 takeover bid is only charged at 4 euros, resulting in spoliation of millions of savers).

Bitcoin (BTC) critics are delighted.

The current crash is a matter of reflection for the perpetrators of detractors, again as always. Let’s go back briefly to 2017, with this article with George UgeuxCEO of Galileo Global Advisors: it was entitled at the time “ bitcoin (BTC) in turmoil, fraud is becoming increasingly apparent. »

There have always been dozens of critics and the list cannot be exhaustive. We can mention Jamie Dimon, JPMorgan Chase boss, said bitcoin (BTC) has no value. »Berkshire Hathaway executives, Warren buffett and Charlie Mungertraditional major financial funds, it is also good to deny bitcoin (BTC).

Charlie Mungernearly a century old, earlier this year cryptocurrencies called a “venereal disease” that he was proud to avoid. Warren buffet He is very skeptical about the sustainability of the “nothing-producing” cryptocurrency.

Nicholas Weavercomputer security researcher at the International Institute of Computer Science in Berkeley, California, sees cryptocurrencies as a huge virus that would see it burn…

Christine Lagarde he sees in bitcoin (BTC) only laundering and “ funny business “, Although his son is a proven crypto investor.

Crash cryptocurrencies and technology stocks

an cryptocurrency crash which comes as the Federal Reserve raises interest rates in an effort to curb inflation, leading to falling high – risk high – tech stocks. The tech-heavy Nasdaq has lost 30% year to date and has been closely correlated with the price of bitcoin (BTC) in recent weeks, according to data from Refinitiv.

As a result, the people who invested in technology stocks also lost a lot. Coinbase, in complete discomfiture, gave up a planned hire for this year. The announcement caused quite a stir on social networks, and some engineers had to give up their job promises (# canceled).

As on the stock market, the cryptocurrency market goes through cycles. If it’s true that the latter looks like an impressive roller coaster, then the crashes can clear the market of the “shitcoins” that are always (too) always. While smart investors know how to play their cards properly, amateurs should always act cautiously and be alert to digital coins and promises of quick success. For lovers of blockchain and bitcoin (BTC) technology, they hardly worry about these fluctuations since they are not motivated by speculation.

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Mary Batshwok

Subprime, financial crises, galloping inflation, tax havens … Bitcoin was designed for greater transparency and possibly to eventually change the situation. I try to understand this new environment and I try to explain it to myself. The road is long, no doubt, but it’s worth it.