It’s been a bad week for the cryptocurrency markets, perhaps the worst since Bitcoin became mainstream. Mere months ago cryptocurrency forums were in celebratory mode, riding a bear market that saw numerous cryptocurrencies hit all time highs. Today, one needs to dig deep to find a token, of the more than ten thousand available to trade, that hasn’t plummeted by double digit percentages in the recent days and weeks.
The downturn in the market has wiped billions of value off the crypto markets and investors, heavily leveraged in crypto assets, have seen their personal portfolios slashed considerably.
These losses have driven some investors to consider the unthinkable, suicide, and online forums, that once lit up with optimism are now posting links to suicide helplines with many investors seeking support in the face of heavy losses.
On a Reddit forum for the once popular Terra (Luna) cryptocurrency project, investors are detailing their losses and openly contemplating taking their own lives.
“I lost over 450k usd, I cannot pay the bank. I will lose my home soon. I’ll become homeless. suicide is the only way out for me,” reads the title of one post that has garnered some 1435 upvotes and nearly a thousand comments since it was posted on May 11.
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Redditors flooded the post with messages of support. “You will get through this. We all will. The most important part is to not give up,” reads one comment. Another commented, “I lost 90k, lower amount but man it hurts.”
Terra (Luna), what investors considered a “stablecoin” and which was once among the top 10 most valuable cryptocurrencies in the world, crashed 98 percent overnight.
Last month the coin was trading close to $120, today it’s trading below a dollar. The dramatic collapse occurred over 24 hours slashing its market cap from above $40 billion to just $500 million.
Popular crypto exchange Binance temporarily halted withdrawals on the Terra (Luna) network during the collapse, meaning holders couldn’t even sell to recover some losses while the coin plummeted in value.
Do Kwon, founder of the cryptocurrency, tweeted on Tuesday, “Close to announcing a recovery plan for $UST. Hang tight.”
In a thread, posted to Twitter, Kwon wrote, “I understand the last 72 hours have been extremely tough on all of you – know that I am resolved to work with every one of you to weather this crisis, and we will build our way out of this. Together.”
Responses were mixed, one person tweeted, “I lost months of work saving money to lose everything in two days! I’m desperate.” While another blasted Kwon saying, “Honestly this is one of the biggest scandals in Crypto – bigger than Bitconnect. You come up with an apology and that’s it. Thousands of retailers have lost everything – everything! You and the attackers have made billions. – The biggest transfer of wealth from poor to rich!”
Entire market in shambles
Scrolling through the popular cryptocurrency website, CoinMarketCap, users will see the page flooded in red.
Bitcoin (BTC), the number one cryptocurrency has seen its value plummet by more than 20 percent in the past week and is now trading at $29,230.87. In November of last year, some six months ago, the coin was trading at an all time high of $67,566.83.
Cryptocurrencies second most popular token, Ethereum (ETH), has dropped in value by more than 27.5 percent in the past week. Currently, it is trading at $1,987.50, a token that was trading at an all time high of $4,812.09 last November as well.
Of the more than ten thousand tokens currently on the market only a handful of them are showing signs of growth, however even growing they demonstrate just how volatile the market is.
A token, SweetSOL (SSOL) is up an astonishing 1155.71 percent in the past 24 hours. However, each token is only valued at $0.000007641. The Agora Token is up 251.29 percent however it only has a fully diluted market cap of $59,605.00, making it one of the smallest players in the market.
Investopedia recommends that new investors to the cryptocurrency scene avoid “getting caught up in the hype.” While Bitcoin has created massive wealth for some individuals, the typical experience is far from that.
New investors need to take the time to understand the different currencies and what they offer with the understanding that anything invested is at great risk of being lost.
The past few weeks in the market is testimony to just how volatile the cryptocurrency markets are and investors, both veteran and new, are not shielded from the consequences of investing in a burgeoning, untested market.
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