Moneycontrol Pro Panorama | Cryptos are jumping from one crisis to another

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They were first marketed as a digital currency, but then the volatility in the asset was so high that proponents of this asset class dropped the idea.

They then tried to justify it by calling it digital gold, but here too the asset did not prove to be the safe haven it was expected to be.

Then, it was sold as a hedge for inflation, but again the claim fell flat on its face.

Now when equity markets are falling, enthusiasts are justifying it by saying the fall in crypto assets is in sympathy with the rout in tech stocks globally.

Cryptocurrencies, which were launched with much fanfare and had seen the fastest growth among all asset classes in terms of attracting funds, are running out of reasons to justify their existence.

Bitcoin, the poster boy of cryptocurrencies, extended losses, dropping below $30,000 for the first time since July 2021, declining close to 50 percent from its record November 2021 high. As compared to this, Dow Jones has fallen by only 13 percent from its 2021 highs.

Smaller cousins of Bitcoin like Ether, Solana and Avalanche have also taken a beating. But the bigger punches were reserved for NFT or non-fungible tokens. Blue-chip NFT collections like Bored Ape Yacht Club (BAYC) saw their price plummeting 29 percent over the past 7 days in US dollar terms.

The JPG NFT Index, which tracks NFTs, also fell by about 26 percent this past week.

The fall could have been brushed aside as one that is seen in volatile financial markets, but there seems to be a