7 things to look back at the craziest week in crypto history
Looking back on the development of cryptocurrency for more than ten years, everyone knows that a lot of crazy things have happened in this field, such as: Mt. Gox suffered a large-scale hack in 2014; American electric car giant Tesla $100 million in Bitcoin; Tesla CEO Elon Musk stands for Dogecoin on SNL (Saturday Night Live), and more. While the buzz of these historical events was second to none at the time, they were nothing compared to the frenzied string of events that took place over the past week.
In the next few days, I believe there will be many articles interpreting these crazy events, and some of them may conduct serious self-reflection on what caused the successive crashes. Anyway, let’s take a look at what’s going on in the craziest week ever for cryptocurrencies.
- Terra crashes
Until a week ago, Terra was the hottest project in the crypto space: its governance token LUNA was in the top 10 by market cap, and its dollar-pegged algorithmic stablecoin UST was the fourth-largest stablecoin of all. Who would have thought, however, that both collapsed at about the same time (LUNA was trading at just 0.1 cents, while UST bottomed out at 13 cents). In fact, many projects have closed down before this, but none of them are as heroic as Terra’s overwhelming decline this time. It is believed that in the near future, the encryption industry will give a conclusion to this disaster and rationally analyze why so many people in the industry trust Terra’s high-risk structure.
- The $200 billion cryptocurrency market cap evaporated in 24 hours
It was previously reported that the cryptocurrency market had lost more than $1 trillion in market capitalization just before Terra crashed. To know that the total market value of Bitcoin in 2020 is only $200 billion. You may have also noticed that most crashes are driven by macroeconomic forces, not just cryptocurrencies, and the cryptocurrency market is now large enough to withstand huge losses. However, it is worth noting that this is a staggering $200 billion!
- Coinbase crashes
Shares of Coinbase (COIN) bottomed out at $40.83 on Thursday, but have fallen 90% from their initial price of $381 in April last year. It is worth mentioning that Coinbase is a giant in the crypto industry, and unlike many tech companies, it is profitable most of the time. In fact, before the COIN collapse, Coinbase continued to spiral upwards, which also shows that Wall Street does not know enough about how to evaluate cryptocurrencies. (On Friday, COIN stock price also recovered to around $70).
- U.S. Treasury Secretary Says Cryptocurrency Has No “Systemic Risk” to the U.S. Economy
U.S. Treasury Secretary Janet Yellen told the U.S. Congress this week that cryptocurrencies have no “systemic risk” to the broader U.S. economy, which is definitely a big deal, since “systemic” is a technical term if there is a “systemic” Sexual Risk”, meaning that the crypto industry will be subject to a series of punitive new regulations.
- The crypto community’s attitude towards Tether has changed for the better
Stablecoins are supposed to be “stable,” but this week, the notion of “stable” in the crypto market appears to be upended. Tether (USDT), by far the largest stablecoin by market cap, also fell as low as $95 during the market rout. But at the time of Terra’s collapse, Tether’s anchoring relationship was found to be relatively reliable, and by increasing scrutiny of Tether’s opaque accounting practices, a tragedy similar to Terra may not have occurred.
- SBF gets a cut of Robinhood
FTX CEO Sam Bankman-Fried revealed that he has taken an 8% stake in crypto app Robinhood, a trend that likely heralds a full acquisition of it as the next step. Robinhood was once a Silicon Valley darling and a serious competitor to Coinbase, but the company’s growth is slowing, and it’s starting to lay off 9% of its staff, and its stock price has plummeted 70% in a year. If they do get acquired by SBF, it will undoubtedly be a Ironic shift.
- Musk is not buying Twitter?
The craziest week in crypto history wouldn’t be complete without Musk.
On Friday, the Tesla CEO hinted that he might not buy Twitter, before clarifying that he is “still committed to the acquisition,” but what will happen next is anyone’s guess. Twitter is one of the largest social media in the world, and Musk’s influence is unquestionable, but can this happen? let us wait and see.
Well, that’s it for the 7 biggest things that happened in the craziest week in crypto history, the crypto industry went into the craziest roller coaster ride yet, but most people in the industry still feel like it’s going to be all right together.