In the span of 24 hours, Bitcoin, Ether, and other coins dropped, wiping $130 billion off crypto markets, as NFL stars with Bitcoin salaries take a major hit, while experts offer tips for first-time investors experiencing their first crash.
The cryptocurrency market saw roughly $130 billion wiped off its value over 24 hours, as Bitcoin and ether fell more than 50% from their all-time highs, trading at their lowest levels since July, in a multi-day selloff of major digital coins, CNBC reported.
Several NFL players may have been hard-hit by the crypto crash. Reportedly, Los Angeles Rams football wide receiver Odell Beckham Jr. famously announced he would accept his “new salary” in bitcoin. The Daily Snark reported that Beckham Jr., Green Bay Packers quarterback Aaron Rodgers, Jacksonville Jaguars quarterback Trevor Lawrence all announced taking their salary in bitcoin, which means all potentially could have lost a huge part of their salaries.
The selloff in the crypto market is correlated to the selling occurring with other higher-risk assets like technology stocks. Experts say investors are preparing for a tighter monetary policy from the US Federal Reserve, which is expected to bring higher interest rates.
Investors say the crash of digital coins, such as bitcoin, has less to do with crypto itself and more to do with the stock market. Experts say cryptocurrencies are now correlated with the stock market’s movements, and that means when the stock market goes down – sodas crypto, The Street reports.
“Cryptocurrencies are no longer an isolated risk asset and are responding to changes in global policy,” one expert told the Wall Street Journal.
On Monday, bitcoin, as of this writing, had lost 48.9% of its market value since setting an all-time high of $69,044.77 on Nov. 10, The Street reported. Ethereum, the second-largest digital currency, was down 50.1%. According to The Street, almost $1.4 trillion has been wiped out of the cryptocurrency market in the last 76 days.
As new investors experience their first-ever market crash, they’ve taken to social media, mainly Reddit, reaching out to veteran investors for tips on how to handle the situation.
One expert from that Bankrate told investors to stay calm and react with a cool head, telling them to ask themselves if they are investing for a quick profit or the long-term.
“Volatility is the name of the game,” the expert from Bankrate wrote. “Cryptocurrency is volatile by nature. Because crypto generates no cash flow, traders have to rely on changes in sentiment to drive the price. That means the market can swing between rabid optimism, as it did in early 2021, to pessimistic despair, as it did a few months later.”
Investors should also consider the opinion of one of the greatest investors of all time, Warren Buffett. In a 2020 interview with CNBC, Buffett said that digital currencies “basically have no value and they don’t produce anything.”