Crypto companies are laying off staff, freezing withdrawals, and trying to stem losses, raising questions about the health of the entire ecosystem in the US and other markets. Headlines after headlines are now heralding the demise of cryptocurrency. ‘Has the music stopped’ for the crypto world? The crypto party is over guys and gals. We tend to think so at least for now.
In the not-so-distant past, no one wanted to miss out on the cryptocurrency mania. But, no more. The time is up, boys.
Some time ago, we had covered the launch of the world’s first Shariah-compliant crypto exchange. We extensively touched upon the concept of crypto and its related terms on these pages. However, we were wrong to say that it was not a bubble that could burst at any time.
As Wall Street Journal pointed out recently, “The cryptocurrency industry was built on swagger, enthusiasm, and optimism. All three are in short supply these days, as losses and layoffs mount.”
In the Muslim world, Indonesia had the largest crypto population, comprising more than 6.5 million people involved in crypto trading. A lot of Muslims from around the world invested their money in crypto assets, too.
In November 2021, bitcoin was trading at around US$70,000. Now, it has dipped below US$20,000.
Why Did the Crypto Market Crash?
We could cite a lot of reasons behind the recent crypto crash. However, we know the world is heading into a recession. Global markets have plunged after the Fed increased interest rates to tame inflation. The uncertainty in the global economy has negatively impacted the crypto market as well.
What is going to happen in the crypto world now after the recent crash? We are not so sure about this. However, one thing had been obvious ever since the cryptocurrencies started gaining attention among the investment community globally in 2009.
The crypto assets boom was destined to bust from the beginning. The tech veterans had questioned the blockchain’s promise of economic salvation. But, not many people listened to them. Everyone was busy making quick bucks in this largely unregulated market.
Prices of bitcoins and other virtual currencies surged in the past two years. Crypto startups proliferated. These companies offered sky-high interest rates on crypto deposits.
The cryptocurrencies may not be completely dead yet. Only the bravest and the largest companies in the industry may survive the crash. Governments may introduce regulatory frameworks to control the crypto market.
Despite all the recent turmoil in the crypto industry, some pundits have been predicting the resurgence of the currency to record-high prices which could go up to $1 million.
To many, the possibility of huge profits is the most interesting thing about crypto — it’s a gold rush in which anyone can suddenly become rich beyond his or her dreams. But the regrettable get-rich-quick mentality that has too long been associated with entrepreneurship, in crypto and elsewhere, must come to an end.
After all, just as most everyone keeps going to work whether the stock market is soaring or tanking, the practical, real-world work of developing blockchain technology will keep on going, independent of the histrionics of the market.
Leave a Reply
You must be logged in to post a comment.