Crypto Crisis: How Digital Currencies Went from Boom to Collapse

THE GUARDIAN: Savers talk of devastating losses as assets such as bitcoin and ‘stablecoins’ like terra fell sharply

Falling bitcoin illustration: Guardian Design
Yuri Popovich had watched his neighbours’ houses burn down to the ground in Kyiv and he needed a safe place to put his money. So he did what millions of amateur investors have done in recent years: he turned to cryptocurrency.

“It was impossible and unsafe to store funds in the form of banknotes. There was a big risk of theft, we also had cases of looting. Therefore, I trusted a ‘stable and reliable’ cryptocurrency. Not for the purpose of speculating, but simply to save,” he says.

The digital asset that Popovich chose in April was terra, a “stablecoin” whose value was supposed to be pegged to the dollar.

It collapsed in May, sparking a rout in the cryptocurrency market whose victims include Popovich. He lost $10,000 (£8,200).

Popovich says his losses were “devastating”, although donations from sympathetic onlookers on social media have helped make up some of the shortfall. He says: “I stopped sleeping normally, lost 4kg, I often have headaches and anxiety.”

Popovich is one of many experiencing the deep chill of the current crypto winter, more than four years after the market’s cornerstone, bitcoin, marked the first digital freeze by tumbling from its then peak. » | Alex Hern and Dan Milmo | Wednesday, June 29, 2022

Crypto Panic as Digital Assets Follow Share Prices in a Downward Spiral

THE OBSERVER: Last week bitcoin fell 31% and Celsius put a hold on withdrawals – and some fear the turmoil is far from over

Investors used to buy bitcoin as a hedge against inflation, but it has proved to be vulnerable to the wider economic downturn. Photograph: Jakub Porzycki/NurPhoto/REX/Shutterstock
The cryptocurrency market could do with some respite but its convention-breaking nature means there is no hiatus. Trading in digital assets such as bitcoin and ethereum runs 24/7, unlike their conventional peers in equities on the New York and London stock exchanges, which at least get the weekend off.

So one torrid week tends to run into another for this most cutting-edge of markets. Bitcoin – the cryptocurrency cornerstone – fell below the key level of $20,000 on Saturday morning, meaning it has dropped 34% in the past seven days, according to CoinGecko, which showed that ethereum, the other pillar of the market, had fallen 40% to $994 in the same period. There are fears bitcoin’s fall will trigger more sell-offs, leading to another tumultuous seven days for digital assets.

The entire crypto market fell below $1 trillion last week, a precipitous decline from its peak of $3tn in November last year. A number of factors drove the declines – a mix of crypto-specific events and wider macroeconomic issues – and some of them will continue to hang over the market this week as well. » | Dan Milmo, Global technology editor | Sunday, June 19, 2022

The Crypto Crash Continues.

THE NEW YORK TIMES: Cryptocurrencies fell again on Wednesday, extending a rout that has dragged down digital currencies more steeply than many other markets. Bitcoin, the biggest cryptocurrency, traded at about $21,000 early on Wednesday, down 4 percent over the past 24 hours, 30 percent over the past week and 55 percent so far this year, according to CoinDesk.

Wall Street analysts have been keeping a close eye on cryptocurrencies to see if they might avoid the slowdown traditional assets have experienced. (The S&P 500 is in a bear market, down about 20 percent this year.) The pullback in the crypto market, however, illustrates the precariousness of the structure built around these risky and unregulated digital assets.

Stock prices of crypto companies have cratered, retail traders are fleeing and industry executives are predicting a prolonged slump that could put more companies in jeopardy, The New York Times’s David Yaffe-Bellany and Erin Griffith report.

“The tide has gone out in crypto, and we’re seeing that many of these businesses and platforms rested on shaky and unsustainable foundations,” said Lee Reiners, a former Federal Reserve official who teaches at Duke University Law School. “The music has stopped.” » | Eshe Nelson | Wednesday, June 15, 2022

‘The Music Has Stopped’: Crypto Firms Quake as Prices Fall

THE NEW YORK TIMES: Crypto companies are laying off staff, freezing withdrawals and trying to stem losses, raising questions about the health of the ecosystem.

Employees of Coinbase in Times Square last year for its initial public offering. On Tuesday, the company said that it was laying off 18 percent of its workers. | Gabby Jones for The New York Times
SAN FRANCISCO — No one wanted to miss out on the cryptocurrency mania.

Over the last two years, as the prices of Bitcoin and other virtual currencies surged, crypto start-ups proliferated. Companies that market digital coins to investors flooded the airwaves with TV commercials, newfangled lending operations offered sky-high interest rates on crypto deposits and exchanges like Coinbase that allow investors to trade digital assets went on hiring sprees.

A global industry worth hundreds of billions of dollars rose up practically overnight. Now it is crashing down. After weeks of plummeting cryptocurrency prices, Coinbase said on Tuesday that it was cutting 18 percent of its employees, after layoffs at other crypto companies like Gemini, BlockFi and Crypto.com. High-profile start-ups like Terraform Labs have imploded, wiping away years of investments. On Sunday, an experimental crypto bank, Celsius, abruptly halted withdrawals.

The pullback in the crypto ecosystem illustrates the precariousness of the structure built around these risky and unregulated digital assets. The total value of the cryptocurrency market has dropped by about 65 percent since autumn, and analysts predict the sell-off will continue. Stock prices of crypto companies have cratered, retail traders are fleeing and industry executives are predicting a prolonged slump that could put more companies in jeopardy. » | David Yaffe-Bellany and Erin Griffith | Tuesday, June 14, 2022

Cryptocurrency Crash Causes Trillions of Dollars’ Worth of Damage | 60 Minutes Australia

It's the oldest saying in the book: What goes up must come down. In the volatile world of cryptocurrency, that's proving to be a brutal truth. Crypto's market value has halved since its peak late last year, haemorrhaging an eye watering $2.2 trillion. And it's not just crypto geeks whose dreams have been shattered, but also ordinary mum and dad investors sucked in by the hype the currency had gone mainstream. However, while many millionaires have become overnight paupers, cryptocurrency's true believers say don't worry, the good times will return. The question is: Who's brave enough to believe them?

You Should Care about the Crypto Meltdown. Here’s Why. | Amanpour & Company

May 18, 2022 • This week, markets were shaken by plunging prices in cryptocurrencies. If you’re not an investor in crypto, you might wonder why it should matter. Instability in cyberspace, it turns out, could potentially impact the entire economy. Hari Sreenivasan gets the details from Stacy-Marie Ishmael, managing editor of crypto for Bloomberg. Originally aired on May 18, 2022.

Cryptocurrencies in Freefall: What Are the Ripple Effects? | DW News

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Cryptocurrencies Melt Down in a ‘Perfect Storm’ of Fear and Panic

THE NEW YORK TIMES: A steep sell-off that gained momentum this week starkly illustrated the risks of the experimental and unregulated digital currencies.

A crash in cryptocurrency prices has wiped away more than $300 billion in value this week. | Samuel Corum for The New York Times
SAN FRANCISCO — The price of Bitcoin plunged to its lowest point since 2020. Coinbase, the large cryptocurrency exchange, tanked in value. A cryptocurrency that promoted itself as a stable means of exchange collapsed. And more than $ 300 billion was wiped out by a crash in cryptocurrency prices since Monday.

The crypto world went into a full meltdown this week in a sell-off that graphically illustrated the risks of the experimental and unregulated digital currencies. Even as celebrities such as Kim Kardashian and tech moguls like Elon Musk have talked up crypto, the accelerating declines of virtual currencies like Bitcoin and Ether show that, in some cases, two years of financial gains can disappear overnight.

The moment of panic amounted to the worst reset in cryptocurrencies since Bitcoin plummeted 80 percent in 2018. But this time, the falling prices have broader impact because more people and institutions hold the currencies. Critics said the collapse was long overdue, while some traders compared the alarm and fear to the start of the 2008 financial crisis.

“This is like the perfect storm,” said Dan Dolev, an analyst who covers crypto companies and financial technology at the Mizuho Group. » | David Yaffe-Bellany, Erin Griffith and Ephrat Livni | Thursday, May 12, 2022

Absturz von Tech-Aktien und Kryptowährungen: der Beginn einer neuen Ernsthaftigkeit an der Börse: Das viele billige Geld der Zentralbanken hat in den vergangenen Jahren dafür gesorgt, dass die Investoren immer grössere Risiken eingegangen sind. Die jüngsten Kursverluste könnten das Ende dieser Ära markieren. »