Crypto investors voice pain and anger as market melts down

Andrew Griffin
Friday 13 May 2022 17:45 BST

Investors have shared their pain and anger after many cryptocurrencies collapsed in a dramatic meltdown.

The crypto market as a whole has seen a dramatic few days, which have wiped billions from the value of investors’ holdings. That drama was particularly focused on – and largely driven by – Terra Luna, a so-called stablecoin that actually saw huge instability.

Terra was supposed to always trade at $1, because it was pegged to the dollar, and therefore be a reliable store of value. But that mechanism broke down in recent days, and saw it lose almost all of its value.

Most of the rest of the market is beginning to recover, with other major cryptocurrencies trading up over the last day. But Terra Luna – which was once one of the top 10 cryptocurrencies – is not moving, and has been hit by technical problems that mean it can be difficult event to buy it.

Cryptocurrency has been hit by dramatic crashes before. But this one is notable in part because it comes after the technology went mainstream in a way it never has before: with shirt sponsorships of major sports teams, ads during the Super Bowl, and endorsements from a number of celebrities.

That left more people than ever hurting this week when the market began to crash and wiped out their holdings.

It also led to the criticism of those who had ridden the high times in the market to mock those who were not participating.

That included Do Kwon, the creator of Terra Luna, who had used his Twitter account to repeatedly mock those who had not bought it as “poor”.

And it led to a combination of sympathy and schadenfreude for others, who posted that they had invested significant amounts of money into their holdings – and lost it all.

On the Terra Luna reddit, moderators pointed to national helpline numbers for those that may be struggling with their situation. They also urged users to not to “invest money you need to survive”.

“This is a very volatile market nobody knows what’s gonna happen,” administrators wrote. “In the long term it definitely will pay off, but short term it can make you feel like shit and I hope you understand that you are not alone in this.”

That forum was filled with desperate stories of people who claimed to have put hundreds of thousands of dollars into the cryptocurrency – spending their life savings and more on the speculation.

Do Kwon last posted on his Twitter account on Wednesday, when he published a long thread aimed at the “Terra Community” in which he urged them to keep their belief. He said that the cryptocurrency would come back, that it had always been about a “long-term time horizon” and that investors should look past that short term.

“Terra’s return to form will be a sight to behold,” he concluded. “We’re here to stay. And we’re gonna keep making noise.”

He has not posted since.

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