The cryptocurrency marker plunges again. What is a crypto winter?

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Cryptocurrency experts fear that we are about to see a “crypto winter” – a period of time when cryptocurrencies lose value.

The news: The cryptocurrency market recently saw $130 billion wiped from its value in 24 hours, as I reported for Deseret News.

Experts see this recent dip as the first sign of crypto winter.

Why it matters: More and more people are investing in cryptocurrency. But a huge drop has investors worried that the investment might not have been a good move.

Details: The drop hurt every major coin, from Bitcoin to Ethereum. Dogecoin and Shib coin also suffered some declines.

Bitcoin and Ethereum fell so low they were 50% below their all-time highs, according to CNN. “Movements in cryptocurrency markets have been correlated with the selling off of high-risk assets like tech stocks as investors brace for tighter monetary policy from the US Federal Reserve and higher interest rates,” according to CNBC.

What they’re saying: “It’s during crypto winters that the best entrepreneurs build the best companies,” David Marcus, the former head of crypto at Meta, Facebook’s parent company, said in a tweet. . “It’s time again to focus on solving real problems rather than pumping tokens.”

It is during the crypto winters that the best entrepreneurs build the best businesses. Now is the time to focus on solving real problems with token pumping.

– David Marcus – dmarcus.eth (davidmarcus) January 24, 2022

Yes, but: Nadya Ivanova, COO of BNP Paribas-affiliated tech research firm L’Atelier, says the crypto winter might not be so bad. But, she said, the market is cooling, according to NBC News.

“Over the past year – especially with all the hype in this market – many developers seem to have been distracted by the easy gains from speculation in NFTs (non-fungible tokens) and other digital assets. could actually be an opportunity to start building market fundamentals.”

The Big Picture: The sharp drop in cryptocurrency is not really surprising, as crypto has a volatile market. Small dips tend to bounce back and drive values ​​up. So it’s something to watch out for moving forward.

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