Bitcoin (pictured) has dropped dramatically in value over the past seven months, from $61,374 ($88,650) in October, to $29,870 ($43,150) earlier this week.

Bitcoin, Terra, Luna, Australia: Crypto bloodbath for Australian investors – Finance

More than a million Australians who have invested in cryptocurrency watched in horror from the financial bloodbath caused by their devaluation this week.

The value of Bitcoin, the most popular cryptocurrency, has fallen over the past seven months, from a peak of $61,374 ($88,650) in October, to $29,870 ($43,150) earlier this week. This is the first time that Bitcoin has fallen below a dollar. $30,000 since July 2021.

Bitcoin has since recovered slightly to just over $31,000, but that’s still a drop of nearly 50 percent in a matter of months.

But while cryptocurrency prices have plummeted in recent days, implying huge losses for many investors, leading expert Carolyn Bowler said there are better times ahead — and explained what is going on.

Bitcoin (pictured) has dropped dramatically in value over the past seven months, from $61,374 ($88,650) in October, to $29,870 ($43,150) earlier this week.

Ms Boehler, CEO of BTC Markets, said that something similar to “running on the bank” has happened to cryptocurrencies in the past two days.

It all started when the two major coins of the Terra cryptocurrency project went into free fall on Wednesday.

TerraUSD, also known as UST, is a so-called “stable currency” that aims to maintain a one-to-one peg to the US dollar.

But floor cabinets fell to 26 cents, before later rising to 68 cents.

Sister token Luna, which has a floating price, fell below 90 cents before recovering slightly to $1.18.

Luna has lost about 96 percent of its value in the past week, and now has a smaller market cap than its stablecoin counterpart.

“The treasury currency has been individually destabilized in what some in the industry are calling a George Soros-style attack, but that is just speculation,” Bowler told Daily Mail Australia.

(Mr. Soros, a Hungarian-born American businessman, made about $1.5 billion in a month in late 1992 by betting on sterling in the UK. There is no indication that he is trying to do anything similar with the floor treasuries.)

“Because that happened, this contagion, along with the volatility that we’ve seen in the Nasdaq and global markets, has combined to create what we’re seeing right now.”

Ms Buller said that the cryptocurrency’s decline simultaneously reflects what is happening in global markets more broadly and is “also linked to the increase in interest rates that we have seen in the United States and all the other major economies.”

BTC Markets CEO Caroline Boehler (pictured) says that something similar to 'running over the bank' has happened to cryptocurrencies.

BTC Markets CEO Caroline Boehler (pictured) says that something similar to ‘running over the bank’ has happened to cryptocurrencies.

She said the recent rally in Bitcoin is directly related to the Covid shutdown. “The injection of excess money (through stimulus payments) was looking for a place to go and drove prices up.”

Ms Buller said that the massive price movements seen in the value of the cryptocurrency are in the process of being festive since it is relatively new.

She said one of the advantages of traditional financial markets is that they have enough time to build liquidity with large institutions and many other market players.

“Because cryptocurrency only originated in the last 10 years or so, it doesn’t have the same underlying liquidity core, so when a part moves, it moves by a bigger chunk.”

The value of the cryptocurrency Bitcoin has fallen by nearly 50 percent in seven months.  In the photo is a person with a bitcoin symbol

The value of the cryptocurrency Bitcoin has fallen by nearly 50 percent in seven months. Pictured is a person holding a bitcoin

Buller completely dismisses a headline in Britain’s Spectator magazine this week declaring “cryptocurrency is dead”.

“People have been saying cryptocurrency is in its upper-face for 10 years, but it is still here,” she said.

“The number of cryptocurrency holders is similar to (the number of people using) the internet in 1997” and that it will continue to grow in a similar fashion, Ms. Bowler said.

The Australian crypto market is worth around $2 billion, with an average investment of around $20,000.

What are cryptocurrencies?

Cryptocurrency is a digital currency that can be used for online transactions.

It’s the internet’s version of money – unique pieces of digital property that can be transferred from one person to another.

All digital currencies use the “blockchain” and can only be created and shared using specific, agreed-upon rules. The rules are slightly different for each cryptocurrency.

Bitcoins are lines of computer code that are digitally signed each time they move from one owner to another.  Physical coins are used as illustration

Bitcoins are lines of computer code that are digitally signed each time they move from one owner to another. Physical coins are used as illustration

People can buy bitcoins through exchanges such as Coinbase and Bitfinex.

Bitcoin was the first cryptocurrency created in 2009.

Other coins like Litecoin and Dogecoin do the same thing but have slightly different levels of inflation and the rules surrounding transactions.

Currently, about 270,000 transactions are made every 24 hours.

These currencies do not exist as physical or digital objects. It’s just a collective agreement with other people on the network that your coin was legitimately “mined”.

Blockchain is the record of changes in ownership of a currency that is broadcast over the network and held by computers around the world.

The network operates by harnessing the greed of individuals for the greater good.

A network of tech-savvy users called miners maintains the integrity of the system by pouring their computing power into the blockchain, the global operating tally of every Bitcoin transaction.

As long as miners keep the blockchain secure, counterfeiting should not be an issue.

However, as cryptocurrencies allow people to trade money without third party interference, it has become popular with liberals as well as tech-lovers, speculators, and criminals.

Leave a Comment

Your email address will not be published.