This Week in Coins: Virtually Every Top 100 Cryptocurrency Sinks as LUNA Scrapes Bottom

This week in coins. Illustration by Mitchell Preffer for decoding

A cursory look at the decode homepage this week would have been enough to see the global crypto industry in a panic.

Crypto’s Craziest Week saw some $200 billion of total market cap evaporated between Wednesday and Thursday as market leaders Bitcoin and Ethereum crashed to all-time lows not seen since 2020involving institutional whales such as Elon Musk and Michael Saylor back under water† In addition, according to Huobi analysts, we haven’t reached the bottom yet

Terra’s leading cryptocurrency LUNA – one of the top 10 in the world last week –fell to zero† LUNA only made a record high of $118.19 last month and is now trading at a fraction of a cent.

LUNA’s downfall was driven by the collapse of Terra’s other leading currency, the dollar-pegged UST, which hit a low at 13 cents Friday, according to CoinMarketCap. It is up slightly today to 19 cents, at the time of writing.

The numbers of the week

It’s now the sixth consecutive week from market decline as virtually every top 100 cryptocurrency by market cap kicks off the weekend with double-digit percentages. Bitcoin is down 20% from last week trading at $28,809, and Ethereum is down 27% to $1,968.

One of the biggest losers of the week: Cosmos was down 43% to $9.68, Algorand was down 43% to $0.42, NEAR Protocol was down 43% to $6.05, Polygon was down 40% to $6.05 0.62 and Avalanche plunged 48% to $29.83.

The only top 100 coin to win this week was Maker, the 42nd largest cryptocurrency by market cap at $1.4 billion, which rose 7.1% to $1,419.

The news of the week

Aside from Terra’s collapse, the news cycle continued as it has in recent months, albeit with heightened rumors of stablecoin regulation.

On Monday, Instagram announced it is testing NFT connectivity with a handful of US-based collectors and makers. The pilot will allow testers to link crypto wallets to their accounts and display verified collectibles. Parent company Meta also said Facebook NFT support is expected soon.

Economist and former no-coiner Nouriel Roubini has begun work on an inflation-proof dollar-pegged stablecoin, according to a Bloomberg report on Monday. Roubini’s Atlas Capital has engaged Andreessen Horowitz-backed Web3 developer Mysten Labs to develop technology for the “United Sovereign Governance Gold” Optimized dollar† The project is a total turnaround for Roubini, who gave a 37-page speech in 2018 calling crypto the “mother of all scams”.

Also on Monday, Salvadoran dictator Nayyib Bukele bought 500 BTC for about $15.3 million. This brought El Salvador’s total Bitcoin supply to 2,300, or about $66 million – currently $6.25 million (9%) shy of its value back then. decode reported the purchase† In total Bukele $37 million in the hole Today.

On Tuesday, Treasury Secretary Janet Yellen highlighted Terra’s collapse as an example of why stablecoins needs to be regulated in the short term† On Thursday, Yellen mentioned crypto again, this time to say that the industry’s $1.23 trillion market cap does not pose systemic risk to the US financial system, nor by extension stablecoins.”but they grow very fast and involve the same kind of risk that we’ve known from bank runs for centuries.”

Securities and Exchange Commission chair Gary Gensler sharply criticized at cryptocurrency exchanges and stablecoins during an interview with Bloomberg on Tuesday. Gensler took issue with the fact that many major exchanges perform custody, market making, and trading services without separating them the way traditional exchanges must, accusing them of “often trading against their clients because they are market markers against their clients.”

That same day, the German Federal Ministry of Finance (BMF) issued the first guidance on the treatment of cryptocurrencies in income tax. Parliamentary State Secretary Katja Hessel said in a statement that the sale of cryptocurrencies such as Bitcoin or Ethereum is now tax-free for individuals after one year of ownership of the assets.

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