The cryptocurrency market continued to hemorrhage money Thursday, with the most popular coins down double-digit percentages over the past 24 hours. And absolutely no one knows when things will bottom out, with many people worried the entire market of fake digital money could go to zero as the stablecoin Tether officially traded below $1 for the first time ever early Thursday.
Bitcoin, the most popular cryptocurrency in the world, is down 11.2% over the past day, currently sitting at $27,959—roughly 58% lower than its all-time high of $69,000 in mid-November. Ethereum has struggled even worse in the past 24 hours, down 19.9% to a price of $1,930.
The culprit for the crypto bloodbath was a chain reaction that started over the weekend when Terra’s stablecoin, TerraUSD, which is theoretically supposed to stay at $1, became “depegged” and started trading below a dollar. That sent shockwaves through the crypto community, since stablecoins are supposedly backed by real assets and aren’t just Monopoly money. At least that was the promise, despite investigative reporters finding it’s all a game of smoke and mirrors .
Tether, the most popular stablecoin in the world, also depegged for the first time early Thursday, dipping to $0.95 on major exchanges before recovering slightly to $0.98 as of this writing. But even at $0.98, the utility of a stablecoin is completely obliterated because it’s not worth precisely $1, causing speculators to rush in and try to make money by buying Tethers at a cheaper price on the assumption they can be sold for $1 later. And that’s exactly the kind of volatility that you already have with cryptocurrencies and doesn’t help people looking for a safe haven asset that can more easily be used to convert to fiat.