Cryptocurrency, Blockchain, and NFTs are just some of the terms we couldn’t stop hearing about on the news and social media not too long ago. We still hear these words today but just not as much and now they’re usually followed by words like fraud, scam, collapsed, crashed, just to mention a few😅. With such a shift in how crypto was once viewed it begs the question what exactly happened to crypto? In this article, I’ll walk you through some of the major events that took place as crypto fell and what is next crypto.
2022 Bitcoin crash
Bitcoin is the world’s largest cryptocurrency and at its peak reached a price of over $60,000. In early 2022 market turbulence caused the price of the crypto currency to drop by nearly two-thirds. By mid-2022 a major US crypto lending company froze all withdraws and transfers causing another drop in its price which fuelled a slump across the whole crypto market causing the price of other major cryptocurrencies to drop. The biggest blow to crypto came in November 2022 after the collapse of crypto trading company FTX which saw the price of bitcoin drop to $16,000 a major drop from its peak.
The collapse of FTX
FTX is a cryptocurrency exchange that was founded by Sam Bankman-Fried (SBF). In November 2022 FTX collapsed due to lack of liquidity, mismanagement of funds, etc.. Then CEO who also founded the company Sam Bankman-Fried was slapped with several criminal charges including fraud and conspiracy to defraud investors. SBF used customer funds to make private investments including real estate and political donations. The collapse of FTX saw many investors lose money. It also had wide-reaching implications throughout the crypto market. This saw the price of major cryptocurrencies such as Bitcoin fall.
NFT crash
NFTs (non-fungible tokens) are unique cryptographic tokens that exist on a blockchain and cannot be replicated. NFTs represent digital or real-world items. NFTs crashed after they’re initial hype which followed a serious rise in their popularity which was fueled by wealthy and famous individuals who invested millions of dollars in the market. Some of the biggest NFT sales we saw were the first tweet done by Twitter founder Jack Dorsey that sold for $2.9 million and a collage of 5000 digital images by artist Beeple that sold for $69 million.
The NFT market crash was caused by several factors some of which included market saturation, global inflations and NFT scams, with one article I read saying common sense killed NFTs because they provide almost zero value over just buying art, digital or otherwise😂.
What’s next for crypto?
With all the bad news associated with crypto, should it be held in the same regard with which it once was? Despite all the many unflattering headlines linked to it, the future of crypto is still somewhat bright. One reason for this is already showing today, the price of the major cryptocurrency Bitcoin has steadily increased over the past few months meaning other smaller currencies will also follow suit. Whether you should invest or not is a story for another day😅. Another reason for its bright future is found in its underlying technology known as Blockchain. Blockchain can be used to power a new version of the internet known as Web3 an upgrade from the current internet we use known as Web2. Web3 would enable greater ownership and control of one’s data by themselves and not by tech companies as it currently is.
Technology at the end of the day is something that takes a long time and lots of trial and error to perfect, with crypto being no exception to this. At the moment it might not be very reliable but in time will certainly improve. If you found this article interesting or insightful kindly like, comment and share. Thank you for reading🙏.