Cryptocurrency Crash Continues As Ethereum, Luna Plummet

The cryptocurrency market continues to witness epic declines this week, so much so that it has erased more than $200 billion from the entire market in a single day.

The second largest the second-biggest digital currency, Ethereum, has fallen 20 percent, below $2,000 ($1,985) per coin, as multiple cryptocurrencies and some stablecoins also plummet.

Bitcoin (the largest cryptocurrency) continued to fall this week, and as of Thursday it is trading at $29,264, after turmoil in cryptocurrencies and conventional stock markets last week.

Crypto chaos

And this turmoil impacted other digital assets, with Terra Luna, another large cryptocurrency, losing almost all of its value (98 percent) overnight and is trading at just $0.015 as of Thursday afternoon.

The stablecoin terraUSD meanwhile has also collapsed to $0.39.

It is fair to say that 2022 has been a fairly terrible year for cryptocurrencies.

Bitcoin has shed a third of its value since January, and Ethereum has now lost more than half of its value this year.

Bear market

But this comes amid broader turmoil in the traditional stock markets, that has seen Apple being replaced by Armaco as the most valuable company in the world.

Amazon has meanwhile lost 30 percent of its value in a month.

Meanwhile some of the world’s leading central banks in countries including the US, UK and Australia last week raised interest rates in an effort to combat inflation.

The Bank of England pushed up interest rates by 0.25 percent to a 13-year high of 1 percent on 5 May.

In the US, the Federal Reserve also raised their interest rates to 1 percent on 4 May – with further rises expected to fend off inflation.

That one percent rise was the Fed’s biggest rate hike in more than 20 years.

And the global economy and investors are having to contend with higher prices and higher borrowing costs, which could slow worldwide economic growth.

And the ongoing conflict in Ukraine, and all the shortages it is causing, is not helping matters.

Tom Jowitt

Tom Jowitt is a leading British tech freelancer and long standing contributor to Silicon UK. He is also a bit of a Lord of the Rings nut...

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