Cryptocurrency has always been volatile, says one economics expert who spoke with ABC News. But 2022 was a stomach-churning, roller-coaster ride for investors and major players in the market. The prices of popular cryptocurrencies plummeted throughout 2022. Moreover, some cryptocurrency companies and their founders are facing bankruptcy and even the threat of imprisonment. Some experts, including David Yermack, a professor of finance at the New York University Stern School of Business, say crypto’s free fall started after investors began selling off digital assets in response to the Federal Reserve’s interest rate hikes. The market took a nosedive after Celsius Network — a former cryptocurrency lending company — announced it was pausing all withdrawals and transfers between accounts in order to “honor, over time, withdrawal obligations.” Celsius had roughly 1.7 million customers and more than $10 billion in assets, The Associated Press reported. A drop in the crypto market in the first half of a year is not unusual, Yermack told ABC News. “Cryptocurrency has been volatile throughout its history and has experienced a large number of sharp rises and falls,” Yermack told ABC News. What really affected the market, he said, was the collapse of TerraUSD, a payment platform for so-called stablecoins.
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