Cryptocurrency analysts call 2022 a disastrous year for digital assets

Cryptocurrency analysts from CoinGecko called 2022 a disastrous year for digital assets — from April to June 2022, the total capitalization of the cryptocurrency market fell by more than 70%.

As it became known from the analysts' report, the capitalization of the 30 largest cryptocurrencies decreased by 68% compared to the peak value of November 2021, when this figure was $ 1.8 trillion. The main reason, according to experts, is the collapse of the Terra ecosystem and the resulting problems of large cryptocurrency platforms.

Interestingly, user activity has also decreased in DeFi applications. Thus, in June, experts recorded a drop in the daily number of users — 34.5% less compared to April 2022. Also, in the second quarter of 2022, NFT trading volume decreased by 26.2%. In June, this figure amounted to $ 830 million and became the worst in the last year.

Obviously, the collapse of the Terra ecosystem has had a negative impact on all members of the crypto community. Recently, it became known that the South Korean digital asset management platform Uprise lost about 99% of its clients' funds due to the liquidation of a short position in Terra’s Luna token. As Luna’s price fell, the artificial intelligence used by the Uprise platform to trade on the futures market shorted the asset from $ 60 to almost zero. The unexpected spike in Luna’s price led to the liquidation of the position.