 | You might have seen Bitcoin (BTC) Peaked today around $67.5K nearly hitting a new ATH. The last time BTC was this high was November 10th 2021. At that time ETH was almost $5k, Terra and it's associated stable coin were making waves with 20% apy, and FTX was still a functioning business. The market has changed significantly since 2021 and this post is going to focus on some of those changes. The Blood of Alts run in the StreetsIn every Bear Market, Alts tend to signficantly lose value against Bitcoin. Of the top 100 Cryptos on Nov. 10th 2021, only four have increased in value. (Tron, LEO, Stacks, OKB) Alts like Cardano and Algo were both about $2.25 the last time BTC was at this price point. Today they are around $.75 and $.25 respectively. ETH peaked just short of $5K and today sits under $4k. Below is an image screenshot taken from WayBackMachine that shows the prices of some top Crypto assets as of Nov. 10th 2021. https://web.archive.org/web/20211110171157/https://coinmarketcap.com/ Next is a screenshot that shows the price of top crypto assets today: The Collapse of Terra/Luna shocks the Crypto Market.In May 2022 Terra Luna was one of the biggest and most well known crypto plays. The crypto consisted of two parts:
Terra could be treated as a speculative Crypto investment, or it could be converted into UST "A stablecoin" with 20% interest. The two were supposedly algorithmically pegged, in the event UST lost value and depegged from $1 a repeg could be reestablished my taking money from Terra to get the value back to $1. But... What happens when UST depegs and people also lose trust in Terra? The answer is a death spiral, and that is exactly what happened in May of 2022. First UST depegged and lost it's $1 peg, than Terra began to mass inflate decreasing the value of all other Terra tokens. This caused more people to want to get out of UST and resulted in a complete collapse of both projects. CoinDesk has an in depth article on this subject: Here Many crypto projects were taking advantage of the supposedly safe 20% yield that UST offered and this single event cause shockwaves through the entire crypto ecosystem with many Crypto entities failing or going bankrupt as a result. Barry Silbert the once famous CEO of Digital Currency Group was one of many organizations to fail after the collapse of Terra and UST. FTX Goes out of BusinessFTX was once the #3 Crypto Exchange behind only CoinBase and Binance. Towards the end of 2022, it was discovered that FTX was padding their books with their own exchange token FTT. This questionable financing lead to many users doubting the liquidity of FTX and created a run on the exchange. A few days later FTX declared bankruptcy and it was discovered there was a multi billion dollar hole of user assets in FTX. Blockworks has a timeline on the collapse of FTX: here The End of an Era: Binance CEO CZ steps down and pleads guiltyAfter the collapse of FTX, CZ Binance famously said that 2023 would be full of FUD and he would respond "4." to FUD. What wasn't FUD is that Binance was a shady organization that aimed to put Corporate Growth over Compliance. At the end of 2023, CZ stepped down as the CEO of Binance and plead guilty to not following anti-money laundering policies. Over the coming days lots of evidence would come out showing CZ knowing allowed high value criminals to use their platform for the sake of profiting from them. https://www.justice.gov/opa/pr/binance-and-ceo-plead-guilty-federal-charges-4b-resolution BTC ETFs are ApprovedNot everything has been bad for BTC, on Jan. 10th 2024 BTC ETFs were approved by the SEC. This opened up a whole new pool of institutional money that could invest in BTC and is arguably partially responsible for the recent rise of BTC as it eyes a new ATH. [link] [comments] |
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