What is a crypto crash?

Crypto crash is a term people use to describe thecollapse in the value of digital currencies in the cryptocurrency market. Basically, factors like interest rates and inflation can greatly affect crypto prices, causing them to fluctuate based on the state of the economy.

Did a crypto crash wipe out $1 trillion in market value?

On Wednesday, a broad crypto crash wiped out about $1 trillion in market value — a staggering drop from $2.5 trillion just a week ago. Bitcoin, which accounts for more than 40% of the global crypto market, nosedived 30% to $30,000 on Wednesday, its lowest point since January.

Why did the crypto market shaky a week before the crash?

The crypto market had been especially shaky for about a week before the crash on Wednesday. On May 12, bitcoin fell 12% after Elon Musk walked back Tesla’s commitment to accept bitcoin as payment, citing concerns over the crytocurrency’s massive carbon footprint.

What's happening to crypto?

Fed interest rate hikes are driving investors back to traditional assets. Institutions are also cooling on crypto following an epic 2021. Total crypto market capitalization has fallen to its lowest level in ten months. A further $130 billion has left the space over the weekend resulting in a market cap slump to $1.62 trillion.