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5 High-Profile Cryptocurrency Implosions Shatter Confidence, Wipe Out Billions in Value During 2022’s Crypto Winter – Market Updates Bitcoin News
2022 was a year of phenomenal cryptocurrency blowouts, as several projects collapsed and many more are on life support after the entire ecosystem was crushed. The fallout from these digital currency projects has not only removed billions of dollars in value from the crypto-economy, but also eroded confidence. The following is a look at six high-profile cryptocurrency project implosions that took place during 2022’s crypto winter.
A look at 5 cryptoassets that fell from glory amid the crypto market downturn
History shows that there have been many failures in the cryptocurrency market economy over the years, and a good example is how eight of the top ten coins on May 5, 2013 have basically been forgotten despite some still having value. Coins like freicoin (FRC), terracoin (TRC), devcoin (DVC) and mincoin (MNC) are all distant memories now. During the 2022 crypto winter, several high-profile crypto projects imploded. Below is a summary of these project failures or cryptocurrency assets that have had their value reduced and communities decimated.
Celsius (CEL)
On January 1, 2022, crypto assets Celsius (CEL) was trading at $4.26 per coin, making it the 93rd largest cryptocurrency by market cap at the time. CEL was essentially an exchange token, and now-bankrupt crypto lender Celsius advertised the ERC20 token as the “backbone of the Celsius network.” However, on June 13, 2022, the cryptocurrency lender paused all operations and stopped withdrawals, and 30 days later, Celsius filed for bankruptcy protection.
Since June 13, CEL has been extremely volatile, and these days the ERC20 token is trading at $0.48 per unit, which is 88.73% lower than its value on the first day of 2022. The ownership of CEL is extremely concentrated, as more than 38% of the entire supply is locked in the bankrupt company’s wallets, and 100 CEL wallets hold 98.90% of the entire supply. Novawulf Digital Management has been revealed as the sponsor of the company’s reorganization plan.
Terra (LUNA)
421 days ago on January 1, 2022, terra (LUNA) was the ninth largest cryptocurrency by market capitalization, with a market cap of $31.86 billion. On that day, LUNA was trading at $88.08 per unit, and the network’s stablecoin UST was still pegged to the US dollar. Today, LUNA is ranked number 55 and LUNA tokens are trading for less than one US cent at $0.00016135 per unit. UST is no longer pegged to the dollar and trades at $0.028 per coin.
After the fallout, Terra rebranded and launched a new LUNA coin, while the original LUNA became LUNA Classic (LUNC). The head of Terraform Labs, the company behind the Terra blockchain ecosystem, Do Kwon, has been charged by the US Securities and Exchange Commission with defrauding investors. Although most of the Terra development community moved on to LUNA 2.0, LUNC still has a small group of dedicated supporters.
HUSD
HUSD is a stablecoin that was delinked from the US dollar on October 27, 2022. It had been pegged to the dollar since September 19, 2019, but is now trading at $0.135 per unit. Although HUSD is no longer a stable coin, its market cap is still $25.64 million. However, in the last 24 hours, HUSD has only seen $11,830 in trading volume, and the token is only listed on a few exchanges.
There are still 187,817,004 HUSD coins in circulation and 9,448 unique addresses have a HUSD coin balance. Typically less than five HUSD transactions are made daily. While HUSD’s current market cap is just over $25 million, it peaked at over $1 billion on May 23, 2021.
Voyager (VGX)
Voyager Token (VGX) is another cryptocurrency that has lost significant value since Voyager Digital ceased operations and filed for bankruptcy protection. In January 2022, a single Voyager token traded for $2.56, but today it is down to $0.45. Like Celsius (CEL), VGX has been able to hold some value as some investors hope the firm’s restructuring plan could strengthen the token.
Like CEL, VGX is very concentrated, with 6,267 unique addresses holding VGX, but 100 holders own 98.6% of the coins in circulation. Typically, fewer than 150 VGX transactions are made on a daily basis.
FTX Token (FTT)
Another exchange token, the ftx token (FTT), linked to a bankrupt entity, has also dropped significantly in value since FTX collapsed during the first week of November 2022. On January 1, 2022, FTT was valued at $38.70 per coin and ranked as the 34th largest cryptocurrency. Today, FTT is valued at $1.49 per coin, and now that the entire supply has been released from the FTX token contract developer, the crypto asset ranking is not relevant.
Like CEL and VGX, there is some hope that FTT can return if FTX manages to restructure parts of the business. For example, after the new FTX CEO, John J. Ray III, discussed the possibility of restarting parts of FTX, the FTT token increased significantly in value. FTT is not available on exchanges as it used to be, as some exchanges blocked deposits after millions in FTT were illegally released from FTT’s main deployment address. FTT is also highly concentrated, with the top 100 owners owning 99.20% of the entire FTT supply.
What are your thoughts on the five high-profile cryptoassets that fell from grace last year? Share your insights in the comments section below.
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