Skip to main content

Number go down

Number go down

/

Panic! In the crypto

Share this story

Illustration by Alex Castro / The Verge

People will say all kinds of things about what Bitcoin is: digital gold, the successor to the dollar as a reserve currency, the future of money, whatever. The thing about Bitcoin, though, is that it’s volatile — and thus, risky. And right now, the market is feeling risk-averse. Bitcoin’s price in dollars has fallen by more than a third since January 1st.

A drop this dramatic doesn’t have just one cause, though it probably didn’t help that we’ve been exiting zero interest rate policy (ZIRP). For a while, the US central bank had set interest rates quite close to zero in order to stimulate the economy. In that environment, it doesn’t make sense to keep money in your savings account — your savings won’t earn enough interest to keep up with inflation. Less-risky assets — bonds, treasury bills — look unattractive.

If they’re de-risking their portfolio, they’re selling Bitcoin

So people begin to do weird things: SPACs, meme stocks, NFTs. Why not? There’s so much money sloshing around, and risky assets have higher rates of returns. Besides, some people think risk is fun! That’s the entire point of the gambling industry, after all.

But the ZIRP world came to an end. Last week, the Fed increased interest rates by half a percentage point, the biggest since 2000, and indicated that it wasn’t done with rate hikes. Some other weird stuff has happened — Russia’s invasion of Ukraine, for instance — that has generally sobered up the markets, too. And so, though Bitcoin is supposed to be independent of the Fed, investors generally aren’t. If they’re de-risking their portfolio, they’re selling Bitcoin.

And investors are definitely selling. “About $475 million in long Bitcoin positions were liquidated over a 24-hours period, according to data from Coinglass,” Bloomberg noted.

It’s not just Bitcoin. Ethereum’s price has also dropped by a third this year. An algorithmic stablecoin called Terra, which is supposed to be fixed at $1, broke its peg twice since Saturday and is, as of this writing, trading at 93 cents. An entry-level Bored Ape Yacht Club NFT has fallen 55 percent in just 10 days, Decrypt points out. This kind of chaos is hard for retail investors to ride out.

Unlike regular assets, crypto markets never close. If there’s a run on stocks, the end of a trading day or a weekend can give investors enough breathing room to re-assess their strategy rather than just panic selling. But this is cryptocurrency, where you can get rekt while you sleep. Good luck out there! You’ll need it.

Today’s Storystream

Feed refreshed 14 minutes ago The tablet didn’t call that play by itself

J
James Vincent14 minutes ago
Today, 39 years ago, the world didn’t end.

And it’s thanks to one man: Stanislav Petrov, a USSR military officer who, on September 26th, 1983, took the decision not to launch a retaliatory nuclear attack against the US. Petrov correctly guessed that satellite readings showing inbound nukes were faulty, and so likely saved the world from nuclear war. As journalist Tom Chivers put it on Twitter, “Happy Stanislav Petrov Day to those who celebrate!” Read more about Petrov’s life here.


Soviet Colonel who prevented 1983 nuclear response
Photo by Scott Peterson/Getty Images
J
The Verge
James Vincent29 minutes ago
Deepfakes were made for Disney.

You might have seen the news this weekend that the voice of James Earl Jones is being cloned using AI so his performance as Darth Vader in Star Wars can live on forever.

Reading the story, it struck me how perfect deepfakes are for Disney — a company that profits from original characters, fans' nostalgia, and an uncanny ability to twist copyright law to its liking. And now, with deepfakes, Disney’s most iconic performances will live on forever, ensuring the magic never dies.


E
External Link
Elizabeth Lopatto50 minutes ago
Hurricane Fiona ratcheted up tensions about crypto bros in Puerto Rico.

“An official emergency has been declared, which means in the tax program, your physical presence time is suspended,” a crypto investor posted on TikTok. “So I am headed out of the island.” Perhaps predictably, locals are furious.


R
The Verge
Richard LawlerAn hour ago
Teen hacking suspect linked to GTA 6 leak and Uber security breach charged in London.

City of London police tweeted Saturday that the teenager arrested on suspicion of hacking has been charged with “two counts of breach of bail conditions and two counts of computer misuse.”

They haven’t confirmed any connection with the GTA 6 leak or Uber hack, but the details line up with those incidents, as well as a suspect arrested this spring for the Lapsus$ breaches.


Welcome to the new Verge

Revolutionizing the media with blog posts

Nilay PatelSep 13
R
The Verge
Richard LawlerTwo hours ago
Green light.

Good morning to everyone, except for the intern or whoever prevented us from seeing how Microsoft’s Surface held up to yet another violent NFL incident.

Today’s big event is the crash of a NASA spaceship this evening — on purpose. Mary Beth Griggs can explain.


D
David PierceTwo hours ago
Thousands and thousands of reasons people love Android.

“Android fans, what are the primary reasons why you will never ever switch to an iPhone?” That question led to almost 30,000 comments so far, and was for a while the most popular thing on Reddit. It’s a totally fascinating peek into the platform wars, and I’ve spent way too much time reading through it. I also laughed hard at “I can turn my text bubbles to any color I like.”


T
Youtube
Thomas Ricker7:29 AM UTC
Table breaks before Apple Watch Ultra’s sapphire glass.

”It’s the most rugged and capable Apple Watch yet,” said Apple at the launch of the Apple Watch Ultra (read The Verge review here). YouTuber TechRax put that claim to the test with a series of drop, scratch, and hammer tests. Takeaways: the titanium case will scratch with enough abuse, and that flat sapphire front crystal is tough — tougher than the table which cracks before the Ultra fails — but not indestructible.


E
Twitter
Emma RothSep 25
Rihanna’s headlining the Super Bowl Halftime Show.

Apple Music’s set to sponsor the Halftime Show next February, and it’s starting out strong with a performance from Rihanna. I honestly can’t remember which company sponsored the Halftime Show before Pepsi, so it’ll be nice to see how Apple handles the show for Super Bowl LVII.


E
Twitter
Emma RothSep 25
Starlink is growing.

The Elon Musk-owned satellite internet service, which covers all seven continents including Antarctica, has now made over 1 million user terminals. Musk has big plans for the service, which he hopes to expand to cruise ships, planes, and even school buses.

Musk recently said he’ll sidestep sanctions to activate the service in Iran, where the government put restrictions on communications due to mass protests. He followed through on his promise to bring Starlink to Ukraine at the start of Russia’s invasion, so we’ll have to wait and see if he manages to bring the service to Iran as well.


E
External Link
Emma RothSep 25
We might not get another Apple event this year.

While Apple was initially expected to hold an event to launch its rumored M2-equipped Macs and iPads in October, Bloomberg’s Mark Gurman predicts Apple will announce its new devices in a series of press releases, website updates, and media briefings instead.

I know that it probably takes a lot of work to put these polished events together, but if Apple does pass on it this year, I will kind of miss vibing to the livestream’s music and seeing all the new products get presented.


E
External Link
Emma RothSep 24
California Governor Gavin Newsom vetoes the state’s “BitLicense” law.

The bill, called the Digital Financial Assets Law, would establish a regulatory framework for companies that transact with cryptocurrency in the state, similar to New York’s BitLicense system. In a statement, Newsom says it’s “premature to lock a licensing structure” and that implementing such a program is a “costly undertaking:”

A more flexible approach is needed to ensure regulatory oversight can keep up with rapidly evolving technology and use cases, and is tailored with the proper tools to address trends and mitigate consumer harm.