Crypto's Lehman Moment
Everyone's still in the process of taking it in. It's going to take a few weeks for us to see the real systemic impacts it's had not only on the asset class from a monetary perspective but more widely speaking, the entire crypto community.
This will mark a significant turning point in the way regulators and the general public will approach crypto. It's a shame that this will likely have insidious impacts on the public's perception of these financial assets.
Speaking anecdotally, this is much worse than the May crash last year, and it's close to that experienced in Covid. This was a washout of epic proportions.
The crypto community of CT shitposters, memers, and degenerate traders aren't Bitcoin maxis, they're slinging perps and on-chain. Everyone was on the SOLUNAVAX trade, and they all got washed. Big time.
I personally wasn't around in markets to experience Lehman or 2008, but I like this comparison by Frank Chaparro. Of course, it isn't a perfect analogy, but relative to the smaller crypto asset class, it could apply.
I'm aware this has happened repeatedly in financial markets: the silver guys in 2010, the real estate crowd before them; and tech investors at the start of the century.
But in the world of crypto, this is one of the first major unwinds that's having wide-reaching, systemic implications for the asset class. Sure, you had the 2017 ponzis that all eventually met their fates at zero, but none were close to this size, nor were contagions.
Some will say blowing up is a net positive as it allocates resources to more efficient hands. They're probably not wrong, and I won't disagree with them.
But at the same time, you just don't make fun of people who've lost it all. Seriously, have some class.
If you were impacted by this, talk to friends, family, or professionals. Don't ask strangers on Twitter or Reddit because people online are ruthless and will want to end you.
As someone who wasn't involved in the Luna ecosystem, I'm intrigued.
But as someone part of the crypto community, I'm disheartened.
It'll take some time for the dust to settle, but once we emerge from the rubble, I think we'll look back on this week as one of the most significant events and turning points in this asset class' short history.