If you’re willing to acknowledge that investing in cryptocurrency is a high-risk bet with a chance of success, but also that you run the very real risk of losing all of your money, it might be a wise thought. In the ongoing global cryptocurrency price crash in 2022, prices of cryptocurrencies, including bitcoin, have been crashing like a pack of cards.
With Ethereum, Bitcoin, and other top coins losing some of their recent gains, prices are dropping once more after a week of gains across most of the cryptocurrency market. As a result, the total market cap has dropped below $1 trillion for the first time in several days.
According to CoinGecko, a well-known cryptocurrency price tracker, the total market value of cryptocurrencies as of this writing is $994 billion. It has fallen below $1 trillion for the first time since July 17 with an almost 6-percent daily decline. Ethereum (ETH), which is currently trading at $1,366, is the top loser among the top 10 coins by market cap.
It’s a stark reversal from last week, when Ethereum was the largest gainer among top coins, apparently due in part to increasing certainty over the timing of the “merge,” an upgrade that is expected to reduce transaction costs for network users and potentially decrease the available supply of ETH.
DeFi tokens—the kind used in non-custodial borrowing, lending, and trading apps—have experienced significant drops over the previous day outside of the top 10 coins. Uniswap’s token (UNI) has dropped more than 14% to a price of $6.25, while Lido DAO’s token (LDO) has lost 17% of its value today at a current price of $1.30.
The collapse of the Terra (LUNA) cryptocurrency and its linked UST stablecoin, along with unfavorable macroeconomic conditions in other financial markets, sent the cryptocurrency market into a tailspin that is still ongoing.
Numerous coins have had recent steep declines and are now trading far below their all-time highs; for instance, the price of Bitcoin has dropped by about 70% from its peak, while the price of Ethereum has dropped by 72%. Both records were reached in November of last year, when the total cryptocurrency market for the first time ever momentarily crossed the $3 trillion threshold.