The crypto bloodbath

Calling cryptocurrencies controversial would be an understatement. Since their inception, they have sparked countless debates online and spawned a plethora of memes. While some, like Elon Musk, have advocated and embraced cryptocurrency as the currency of the future, investors like Warren Buffett and Charlie Munger have called it the currency of drug traffickers and kidnappers.

While there are heavy hitters on both sides of the ring, what does the data say? Has crypto currency proved its naysayers wrong?

Let's look at some of the figures. The industry has gone from being valued at $3 trillion to $900 billion in a single year. And the market indicates this decline is not going to halt anytime soon. Bitcoin, the world's largest cryptocurrency, shed 70 per cent in value since its all-time high last November.

Moreover, since 2020, more than 70 crypto exchanges have shut shop, eroding millions of dollars. In the latest chapter of the crypto story, FTX, one of the biggest crypto exchanges, sank from a $32 billion valuation to bankruptcy.

The valuation trends (as shown) paint an even more graphic picture. As you can see, cryptocurrencies are sinking, and how. It's troubling to think that this asset is hurtling to its three-year lows.

The aftermath
These are worrying times for crypto investors, and there's a widespread fear globally regarding investing in cryptos.

So are cryptos doomed forever, or will they eventually rebound?

Cryptos are inherently unpredictable, and it has always been difficult to form a concrete opinion about them. However, their recent downfall has been a wake-up call for anyone practising the "get-rich-quick" mantra.

The only road to wealth creation is identifying good long-term investment solutions and holding on to them. The rush to make a quick buck has led to many people gambling away their hard-earned wealth.

Suggested read: Bad news: The crypto racket will survive