Number go down

Illustration by Alex Castro / The Verge

People will talk about everything from the future of money to digital gold, the successor to the dollar as a reserve currency. It is risky because of its volatile nature. The market is afraid of risk. Since January 1st, the price in dollars has fallen by more than a third.

The dramatic drop doesn't have just one cause and it probably didn't help that we've been exiting zero interest rate policy. The US central bank had set interest rates close to zero in order to boost the economy. Your savings won't earn enough interest to keep up with inflation, so it makes sense to keep your money in a savings account. The less-risky assets look unattractive.

People begin to do weird things. Why not? Risky assets have higher rates of returns because there is so much money around. Some people think risk is fun. The entire point of the gambling industry is that.

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. The invasion of Ukraine by Russia has sobered up the markets. Though it is supposed to be independent of the Fed, investors generally aren't. If they are de-risking their portfolio, they are selling Bitcoins.

According to data from coinglass, about $475 million in long Bitcoin positions were sold over the course of 24 hours.

It's not just the digital currency. The price of ether has dropped by a third this year. Terra, which is supposed to be fixed at $1, broke its peg twice since Saturday and is currently trading at 93 cents. The Bored Ape Yacht Club NFT has fallen 55 percent in 10 days. Retail investors can't ride out this kind of chaos.

Unlike regular assets, the markets never close. If there is a run on stocks, the end of a trading day or a weekend can give investors enough time to re-assess their strategy. You can get rekt while you sleep. Good luck out there! You will need it.