Just weeks ago, Luna, a cryptocurrency by Terra Blockchain, was one of the hottest coins in the game. By market valuation, it was one of the 4th most valuable cryptocurrencies. Now, its value is zero and the Reddit community where Luna owners gathered and talked has put the suicide prevention help number in the pinned post on the community page. In the last two weeks, Luna has seen its value fall to zero. Essentially, all those who hold Luna now hold a cryptocurrency that isn't worth a dime.
For Terra, just Luna has crashed, but also TerraUSD, which is supposed to be tagged with US Dollar at 1:1 rate. Traded at a rate of USD 1 until May 9, the TerraUSD is now worth less than 20 cents, showing that in real-world a cryptocurrency, irrespective of the idea behind it, has no tangible value and an institutional mechanism that can guarantee whatever value it holds.
Luna has now been delisted from major crypto exchanges, including WazirX and CoinDCX. "We will enable Binance free transfer for users to withdraw their Luna funds," WazirX said in a note.
But Luna and TerraUSD aren't the only cryptocurrencies that have seen their value plummet in the last week. While that is the extreme case — with Luna losing all its value and turning to dust — almost all cryptocurrencies are in a free fall.
Bitcoin, which was once selling above $50,000, is now at a price of around $28,000 and falling. The same is with Ethereum, which has also seen its value plummet by some 20 odd per cents in the last 10 days. Experts estimate that around $800 billion of wealth has been wiped from the cryptocurrency market as many have tried to sell whatever crypto coins they hold.
The result is that the cryptocurrency communities on Reddit and around the world are in utter chaos right now. While many want to get out of the crypto scene, some are still believers in "HODL."
"As a person living in a sanctioned country like Venezuela, crypto is my only investment option right now. It's very scary now with the LUNA crash. I wish I could diversify it and invest in ETFs and stuff like that," a Reddit user with ID "asdrubalivan" wrote on Friday on the main cryptocurrency discussion board.
"Imagine you went on holiday for a week, totally switched off from crypto, then came back to see a top 10 token in the toilet," notes another user who goes by the name "KalSereousz". Adds another user, "I've never seen wealth destruction happen that quick. For any asset class or any time."