7 Big Moments from the Craziest Bitcoin and Crypto Week Ever

Where to start? In a decade of cryptocurrency coverage, I’ve seen a lot of crazy things, but never a week like this. In the past, there have certainly been one-off incidents that have turned the industry upside down – such as the Mt. Gox in 2014, or Tesla buying $1.5 billion worth of Bitcoin, or Elon Musk shilling Dogecoin on SNL – but never a cascade of events like we’ve just seen.

In the coming days, there will be many pieces of reflection on what caused the madness. And perhaps there is serious self-reflection on why the cryptographic community tolerates the people who unleashed much of the current mess in the first place. But for now, let’s take a deep breath and take stock of what the heck happened in the craziest week in all cryptocurrencies. Here are seven key moments.

1. earth catches fire: Until a week ago, Terra was the hottest thing in crypto: its governance token LUNA was a top 10 coin by market cap, and its dollar-pegged algorithmic stablecoin UST was #4 stablecoin. And then, pop! Both went close to zero. (LUNA is trading at a fraction of a fraction of a cent, while the UST has bottomed out at 13 cents.) Many projects have collapsed before Terra, but never one this big and never so spectacularly. The cryptocurrency world will be talking about this disaster for years to come – and doing autopsies why so many in the industry were so quick to put their faith in Earth’s high-stakes framework.

two. $200 billion in cryptographic value vaporized in 24 hours: This is from a Bloomberg story on Thursday, which followed earlier reports that cryptocurrency markets had already lost more than $1 trillion. before the collapse of Earth. To put that in perspective, $200 billion is more than total market value of Bitcoin in 2020. If you want to put a positive spin on the carnage, you might note that much of the collapse was driven by macroeconomic forces (it’s not just crypto bleeding red this month) and that the crypto market is now big enough to survive. to a loss of this magnitude. But still. $200 billion!

3. COIN collect: On Thursday, Coinbase (COIN) shares hit $40.83 — a 90% drop from their debut price of $381 in April last year. This is the leading company in the cryptocurrency industry and, unlike many tech companies, it has been profitable for most of its existence. Coinbase’s spiral, which was underway well before this week’s market crash, mainly reflects that Wall Street still doesn’t know how to value cryptocurrencies. (On Friday, the stock began to rally back to nearly $70.)

4. Secretary Yellen says no systemic risk: This news has been buried in market madness, but it is important that the Secretary of the Treasury told Congress this week that cryptocurrency poses no “systemic risk” to the US economy at large. The term “systemic” is technical and would have subjected the industry to a punitive set of new regulations.

5. Tether breaks the buck: Stablecoins must be stable. This week put the whole concept into question. Tether (USDT), the largest stablecoin by far, briefly dropped to 95 cents before rallying. Tether has broken its peg in the past, but in the midst of Terra’s debacle, its latest slip was a terrifying moment – and it will only increase scrutiny of Tether’s opaque accounting practices.

6. SBF takes a piece of Robinhood: FTX CEO Sam Bankman-Fried revealed that he took an 8% stake in HOOD, which could portend a full takeover. If that happens, it would be an ironic turn for Robinhood, which was once seen as a Silicon Valley darling and a serious rival to Coinbase. Now, its growth has slowed, it’s cutting 9% of its workforce, and the stock is down 70% in one year.

7. Musk says “maybe not” to Twitter: It wouldn’t be a crazy week in cryptocurrency without some antics from Elon. Sure enough, the Tesla CEO started on Friday by suggesting he might not buy Twitter after all; the stock reacted badly. He later clarified that he’s “still committed” to buying Twitter, but what happens next is anyone’s guess. Twitter is the most important communication platform in the industry and Musk is its biggest influencer, so everything matters.

Those were just seven news moments in a week filled with many more — including an impending El Salvador default, thanks to mismanagement by the country’s Bitcoin Bro chairman. Cryptocurrency has entered its craziest rollercoaster yet, and my biggest conclusion is that most of the industry will be fine. WAGMI, as they say. Unless you’re an Earth bagholder.

That’s it Roberts in cryptography, a weekend column by Decrypt Editor-in-Chief Daniel Roberts and Decrypt Executive Editor Jeff John Roberts. Sign up for the Decrypt Debrief email newsletter to receive it in your inbox every Saturday. And read last weekend’s column: Bitcoin’s bloodbath will get worse. This is good.

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