Crypto Market Sheds Over $1 Trillion in Latest Crash

VYSYN Ventures Weekly Insights #83: Bitcoin plummets to six-month low and Microstrategy loses $4 billion on paper

BTC, ETH lose over 10% amid latest crypto dump

The global cryptocurrency market started a downtrend on Friday, January 21st, 2022 with Bitcoin floating around $40,000 early Friday morning. It continued its way down, dropping 10% within 24 hours. By Saturday morning, BTC had dipped below the $35,000 mark, according to data from CoinMarketCap.

MicroStrategy loses $4B in paper profit and Coinbase shares drop 15%

Bitcoin’s price decline in the past few days has wiped out a whopping $4 billion in paper profit for leading business intelligence and software company, MicroStrategy. MicroStrategy, the largest institutional holder of BTC, has been bullish on the digital asset ever since it made its first BTC purchase of $250 million in August 2020. The company had steadily increased its Bitcoin holding over the past 17 months, bringing its total holdings to 124,391 coins. At the previous ATH, MicroStrategy’s coins would have been worth a groundbreaking $8.4 billion. With the recent crash wiping 50% of BTC’s price, MicroStrategy lost $4 billion in paper profit, as the company pledged to continue HODLing for as long as necessary.

Fed toys with the idea of issuing a CBDC

Analysts are concerned that the launch of a government-issued digital dollar would adversely affect the adoption of cryptocurrencies. On Thursday, January 20th, 2022, the U.S. Federal Reserve released a highly anticipated report that focused on the prospect of issuing a central bank digital currency (CBDC).

Speculations of a crypto winter

Amid several speculations about what could have fueled the recent crash, some crypto investors have hinted at the possibility of a “crypto winter”. This phrase refers to a sharp collapse in crypto prices, followed by a long period of reduced trading activity. The most recent crypto winter occurrence was in late 2017 and early 2018, which saw Bitcoin losing as much as 80% of its value from ATHs.

What does 2022 hold for the crypto market?

Currently, the market is seeing a little stability as most of the coins have regained some of their losses and have returned to the consolidation phase. At the time of writing, BTC was trading at ~$37,500 and ETH was trading at ~$2,460, with the global crypto market cap sitting above $1.7 trillion, according to CoinGecko data.

About VYSYN Ventures

VYSYN Ventures is a longstanding venture capital company that specializes in funding and supporting disruptive startups in the blockchain and cryptocurrency industry. We have provided early-stage support to several projects that have grown USD market capitalizations of hundreds of millions and even billions. Our incubation program focuses on providing capital allocations, versatile marketing support, and tech assistance.

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VYSYN VENTURES

VYSYN VENTURES is a premiere venture capital firm focused exclusively on blockchain technology and the digital currency ecosystem. www.vysyn.io / hello@vysyn.io