The cryptocurrency market continued to bleed money on Thursday, with the most popular coins dropping by double digits in the past 24 hours. And nobody ever knows when things will end, as many people worry that the entire market for fake digital money could go to zero as the stablecoin Tether officially traded below $1 for the first time ever early Thursday.
Bitcoin, the world’s most popular cryptocurrency, is down 11.2% over the past day and is currently at $27,959 – nearly 58% below its all-time high of $69,000 in mid-November. Ethereum has struggled worse over the past 24 hours, dropping 19.9% to $130.
The culprit in the crypto bloodbath was a chain reaction that began over the weekend when Terra’s stablecoin, TerraUSD, which is theoretically supposed to stay at $1, became “unbundled” and began trading at less than a dollar. This sent shock waves through the crypto community, as stablecoins are supposed to be backed by real assets and not just monopoly money. That was at least the promise, even though investigative reporters found out every game smoke and mirrors.
Tether, the world’s most popular stablecoin, was also unpegged for the first time early Thursday, dropping to $0.95 on major exchanges before recovering slightly to $0.98 as of this writing. But even at $0.98, the utility of the stablecoin has been completely obliterated as it is not exactly worth $1, causing speculators to rush out and try to make money by buying Tethers at a cheaper price assuming they can be sold for $1 later. And this is exactly the kind of volatility that you already have with cryptocurrencies and it does not help people who are looking for a safe haven asset that can be used more easily to convert to cryptocurrencies.
Terra’s Luna, the world’s fourth most popular cryptocurrency as of Monday morning, is down another 98% in the past 24 hours. The cryptocurrency is currently trading at just $0.04, and the cryptocurrency was worth over $87 just a week ago, and $54 early Monday. Stories have surfaced on social media sites like Reddit about people losing her completely life savings In Luna’s breakdown, though, Gizmodo hasn’t been able to independently verify any of these stories yet.
Other top crypto coins have also tanked, with BNB down 18% over the past 24 hours to $254.45, XRP (Ripple) is down 28% to $0.36, Cardano is down 32% to $0.44, and Solana is down 33% to $43.14. Dogecoin, the joke meme currency turned serious investment, is down 29% over the past day to $0.07.
As we explained on Monday, if you invested $100 in any of the most popular cryptocurrencies six months agoYou have lost a large amount of money. And if you listened to Matt Damon during his Super Bowl commercial for Crypto.com insisting that “wealth favors the brave,” you’re probably fighting back.
As cryptographic expert Ben McKenzie points out, on TwitterThere are a few things to look out for as the crypto market crashes. First of all, look for exchanges to suddenly stop letting people withdraw funds in the name of “scheduled maintenance,” something that US Binance already announced overnight will happen this morning from 6:00 a.m. to 9:30 a.m. ET.
“While these scams are fun (and profitable for adults) when the price goes up, when the price goes down everything tends to fall apart. You, dear regular casino sponsor, are not at the forefront of their ideas…” MacKenzie chirp.
But that’s just one expert’s opinion. How low can the cryptocurrency go? Again, no one can say for sure. But if you are looking for some cheap cryptocurrency, you better wait at least to see what happens with Tether in the coming days and weeks. Experts like McKenzie have warned that a Tether crash could lead to an entire Bitcoin devaluation no thing. We may now be able to see if this theory will ever die.