The sale of cryptocurrencies is intensifying, and the recent collapse of UST raises questions about the viability of stablecoins as an asset class. Against this background, the number of predictions about the sudden demise of Bitcoin and the oblivion of the entire cryptocurrency industry has increased.

The continuation of the Bitcoin correction was brewing back in March-April, however, shrimp (users with wallets less than 1 BTC) in these months absorbed 0.58% of the total circulating supply, increasing their share to 14.3%. Nevertheless, the activity of this group was not enough to keep the price from the pressure of objective factors. In April and May, we talked about why the key investment force – institutional investors – are fleeing Bitcoin.

With the fall in the capitalization of the crypto market, private problems have worsened.

Thus, the growth of Terra (LUNA) was largely due to the high annual yield, which reached 20% when holding the UST stablecoin on the Anchor platform. Before the collapse of the stable coin, Anchor held 75% of the circulating supply, or $14 billion. As soon as the bundle of UST and the US dollar was broken, investors rushed to withdraw their funds (more in yesterday’s material).

The collapse of the third-largest stablecoin raised the question of the viability of this asset class, and Finance Minister Janet Yellen urged Congress to urgently develop a bill regulating stable coins.

The risk of collapse concerns not only algorithmic stablecoins, but also centralized ones, such as Tether with a capitalization of $82 billion. An audit conducted last year showed that instead of the promised dollars in bank accounts, the company mainly holds securities as a reserve. This can also lead to a liquidity crisis in the event of an active sale of USDT. Cautious investors are already getting rid of USDT – its capitalization has decreased by $1.4 billion in a few days.

In the event of a break in the USDT-USD bundle, the cryptocurrency market may indeed face a full-scale crisis and a serious outflow of capital. So, gold apologist Peter Schiff already predicts the fall of Bitcoin below $ 10 thousand. And yet this is not enough for the funeral of Bitcoin, whose strength lies in decentralization, independence, lack of politics and geographical boundaries.

In this regard, the statistics of the 99Bitcoin website, where the Bitcoin obituary has been conducted since 2010, is noteworthy. During this time, the cryptocurrency was buried 448 times, and the peak occurred in 2017 with 124 deaths. There are only seven obituaries this year, but recent events hint at an increase in funeral moods.