Crypto investors dig for long winters because the market erases two-year profits – disputed

This happens in every bear market – total capitalization.

For months, investors have been hoping that the market will break a short-term gap and return to its bullish ways. Damn! Something will happen and the market knows … this is going to be a long term boom.

Atomic cold

This time that something is called Celsius. And with the news of the CeFi exchange’s decision to suspend withdrawals this week, the crypto market has turned into something worse: another possible nuclear winter.

All that Bitcoin and Ether have gained in the 2020-2021 bull run is over. Bitcoin, which has fallen more than 7% in the last 24 hours, is trading at $ 22,400 during mid-morning trading in the UK, according to Koenzeco. It was at the same level in mid-December 2020.

The lowest level

And Ethereum, down 1% in the last 24 hours, fell to 1,200. The last time it was in that vicinity was in January 2021. Even more shocking, Monday ETH fell below its all-time high in early 2018 rallies.

Meanwhile, according to CoinMarketCap, the market capitalization of the crypto market has dropped below $ 1 trillion, its lowest level since January 2021. And the market value of CoinGecko’s DeFi index, which includes scores of leading tokens such as Aave, Uniswap, and MakerDAO, has fallen 26% in the last five days to $ 36B.

As the reality of this new bear market sinks, the old crypto hands are reminiscent of the dark days of the crypto nuclear winter. Tokens have been in disarray from 2018 to 2020 after the initial currency offering bubble burst.

Risky assets

This time around it’s not just crypto that is being hit – the S&P 500 index moved to a better market of its own on Monday, showing an 8.6% jump in consumer prices in May after the release of inflation figures. Investors expecting the Federal Reserve to raise interest rates by 0.75 or even 1% are accumulating risky assets such as stocks and cryptocurrencies. (A bear market is usually exposed when prices fall by 20% in at least two months).

The interrelationship between crypto and stocks has become one of the most striking developments of the last year. Bitcoin, of course, should be the ultimate inflation hedge because it disconnects from central bank policy setting, interest rates and other devices of TradFi. Yet investors view Bitcoin as a stock of high-growth technology.

In the case of Ethereum, investors are waiting for The Merge, a transition from blockchain proof-of-work to proof-of-stack. Expected in the third quarter, the conversion will further differentiate DeFi’s workhorse from Bitcoin and possibly encourage a new look from investors. If Crypto Atom is a Winter Guide,

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