As is often the case, it is Elon Musk who provides an effective snapshot of the cryptocurrency market. “Cryptonight”, he tweeted in the night, summing up in one word what has been proving to be among the worst cryptocurrency collapses for about 72 hours. It is the night, the winter, and no one knows how long it will last. Bitcoin in the morning it approached the psychological threshold of $ 20,000, trading at $ 20,125, down 4.8% and returning to the valuations of 52 weeks ago, before recovering slightly. The other cryptocurrencies follow closely, with Ethereum traded at $ 1,100, down 6.2%, Binance Coin at $ 211, down 3.7%, while the market capitalization of the entire sector was -6.5% at 878 billionless than a third of the November 2021 record.
Investors on the run waiting for the Fed, Celsius and Coinbase scare
Investors are on the run from cryptocurrencies. Market analysts interviewed by Reuters are certain of this. And the wait for the decision of the Federal Reserve, the American central bank, which is about to announce a rate hike that the market is pricing at 75 basis points to fight inflation, is also complicit.
Bitcoin
Why are cryptocurrencies collapsing
by Arcangelo Rociola
But the whole industry is in turmoil. On Monday, Celsius, the largest cryptocurrency deposit account in the world, announced a stop on withdrawals due to bad market times. Coinbase announced a massive corporate restructuring plan on Tuesday with the layoff of 18% of its staff. 1,100 people will lose their jobs. Coinbase, which is one of the leading cryptocurrency exchanges in the world, has lost 86% of its value to Nasdaq since its listing in April 2021.
Layoffs in the industry, but Binance hires 2,000 people
News that have triggered a wave of sales that at the moment does not find a brake. Also BlockFicryptocurrency exchange, e Crytpo.com they have announced cuts for hundreds of jobs, while the chill on the technology sector is also lapping Intel e Metawho have temporarily suspended their hiring plans, thanks to the bad times in the technology sector.
Ferrero (Young): “The collapse of bitcoin does not scare us. For some it will be an opportunity”
by Arcangelo Rociola
In this context, however, the announcement of Binance who, going against the trend, almost going to the muscle test, announced that he wanted to hire 2,000 people, even if he did not specify what kind of contracts they will be, and what positions the new hires will hold. Even on Binance, shadows lengthened on Monday, when the company had blocked withdrawals, only to point out that everything was due to a technical problem, a transaction that blocked the others.
Are cryptos ‘too big to fail’?
Meanwhile, the latest crash begins to raise doubts whether the cryptocurrency sector can withstand price changes like those to which we have become accustomed in recent years. Behind cryptocurrencies, there are often billions of small savers and investment funds, who can in some cases risk losing everything. In the industry forums on Reddit, many messages from users and retail investors go in this direction.
Is the cryptocurrency system too big to collapse? It is no coincidence that various sector operators are asking that the legislator, in Europe and in the United States above all, intervene to give rules and define crypto as an investment asset among others. It is difficult at the moment to only assume that the request can be accepted.