No Relief in Sight for Crypto Investors

Risk Disclaimer >>
Ad disclosure ChesWorkShop takes pride in assisting you in forging wise financial paths. To realize this, we associate with seasoned professionals to deliver the latest updates and details. Interactions involving specific links, sponsored narrations, products and/or services, broker lead transfers, or advertisements can potentially earn us a fee. Our objective is to maintain a space where users can interact without encountering disadvantages. Bear in mind that the details shared on our webpage do not hold the ground as legal, tax, investment, financial counsel, or any formal advice but are shared with an informational intention only. If in doubt, we propose reaching out to an independent financial advisor.

Another week has passed, and the grim news regarding the recent crypto crash has continued to spread. What initially seemed like a blip in the market is now looking more and more like a major disaster that will likely cost investors billions of dollars.

Crypto firms over the world are in agreement that thousands of digital currencies will likely collapse over the next few months, or even years, with the bigger players, such as Bitcoin, taking the brunt of the blow.

The Unlikely Has Happed 

With more than 19,000 cryptocurrencies in existence right now, it seemed that the industry had become strong enough to survive any such financial disasters. However, if the last few weeks have been anything to go by, a full-on global collapse is not only possible but according to some sectors, is actually very likely.

Asked about his thoughts on the matter, the CEO of the Web3 Foundation, Bertrand Perez, said the cause of the current situation we are facing is that we are at a stage where there are too many blockchains and digital tokens available on the market for it to be sustainable. The resulting added risk is what is causing confusion and affecting investor confidence.

A few months ago, during the time when the crypto market was going through its most successful and profitable period, no one, except the most pessimistic of financial advisors would have predicted that this could ever happen in such a short time. However, that is the exact state that the industry is in.

During an interview at the World Economic Forum in Davos, last week, Bertrand Perez went on to say that the crypto collapse is, in many ways, similar to the beginning of the internet. That period saw a lot of dot-com companies emerging, many of which were scams that did not bring any value to users. The result was that all these fake platforms were eventually cleared from the system. This left behind only the real and legitimate companies that are giving us the services we enjoy today.

These sentiments were echoed by Scott Minerd, Chief Investment Officer at Guggenheim when he bluntly declared that most of what we see on the crypto market is “junk.” It is statements such as these, and the general consensus among industry experts, that have many investors running for the hills and compounding the already dire situation.

“Save Us!” Says the Tech World To Congress

In an industry built on foundations of attaining freedom from government control and censorship, to hear technology experts calling out to Congress for assistance is surely taboo. However, that was the situation on the ground when more than two dozen of the industry’s most respected technical experts signed a petition asking Congress to step in and take a closer look at the goings-on in the crypto markets.

Senate Majority Leader Chuck Schumer and various other senior Senate officials received this request on Wednesday, 1st of June, and at the time of writing, no definitive action had been taken. However, such a unified call for help is unlikely to be ignored, and we fully expect a response from Senate in the next few days.

In the letter, which was a direct response to claims made by crypto pushers that crypto-assets were an “innovative technology that is unreservedly good,” tech experts asked law officials to step in and take a deeper, and more skeptical, look at the way the crypto market was operating.

The letter went on to urge officials to resist pressure from crypto market boosters, lobbyists, and financiers, who wanted to create a sort of safe haven that protects risky, unproven, and in many cases, flawed technology. It is better to protect public interests and ensure that any technology being offered is genuine and offers legitimate services to the general public, according to the tech experts.

Final Word

Exactly how much longer the crypto industry will continue to fall is uncertain, but when we see the leaders and technical experts of the industry take a sudden U-turn and start to urge caution and cry for help, it is a sign that the worst is likely still to come. Smaller platforms continue to see some measure of activity, unlike bigger names, but for how long this will continue is anybody’s guess.

Risk Disclaimer

ChesWorkShop commits to presenting fair and reliable information on subjects including cryptocurrency, finance, trading, and stocks. However, we do not have the capacity to offer financial guidance, advocating instead for users to conduct their own diligent research.

Leave a Reply

Your email address will not be published. Required fields are marked *