What is the impact of the crypto crash of 2022?

Top cryptocurrencies such as XRP, Solana, BNB, and Cardano have lost up to 30% of their value. Overall, the great crypto crash of 2022 has wiped out $1.5 trillion from the industry. What potential impacts will this crash have on the world?

What's happening with Crypto?

The price crash of many major currencies has dominated crypto news recently. Just two months after reaching its all-time high of nearly $70,000 in November 2021, Bitcoin fell to a little over half at $37,000 in January 2022. The price of Ethereum has crashed to around $2,400, down from almost $5,000 at the end of 2021.

What happened to cryptocurrencies in China?

Other cryptocurrencies also tanked: Ethereum fell more than 40%, while dogecoin and binance lost around 30%. By Thursday, bitcoin had recouped some losses and was back above $41,000. But a Friday statement from Chinese officials reiterating the need to crack down on cryptos beat bitcoin back down. It was trading around $37,000 on Friday afternoon.

What causes cryptocurrencies to crash?

An abrupt drop in price can generate panic, with traders escaping to cryptocurrencies with more stable value or fiat. Flash crashes can occur beyond the immediate control of human beings. They may be produced by algorithmic trading programs, triggering one another to sell in a feedback loop.