> I am confused as how this is a story about crypto and not story about Celsius.
Because it's a relatively small eco system and everything is tied together. As soon as one domino is falling the whole eco system follows.
And look at the graph of the top 20 cryptos, they all follow the exact same graph as BTC. Anything bad happening at a relatively large scale to BTC = BTC goes down = the whole crypto world panics = they all go down
I would question the characterization of small. Even today, total crypto market cap is just shy of 1T. Even relative to more established plays it is nothing to sneeze at.
But note that the same could be argued about USD system("Look at this market today. Everything is falling. Everything is tied together. One bad inflation reading and domino is falling down and the whole ecosystem follows."). I am exaggerating for effect, but not that much.
> Even today, total crypto market cap is just shy of 1T.
That doesn't mean there's that much money in it.
I bought a glass jar of sand on vacation, for $5. That doesn't make the beach worth trillions based on how many $5 jars it could be made into, but that's how crypto market caps are calculated.
Maybe not, but that's how market cap is calculated in the stock market also, and it's considered an important metric in the stock market regardless.
"Market cap—or market capitalization—refers to the total value of all a company's shares of stock. It is calculated by multiplying the price of a stock by its total number of outstanding shares. For example, a company with 20 million shares selling at $50 a share would have a market cap of $1 billion."[1]
That's the same thing as Bitcoin's market cap being calculated at $438 billion right now, because there's 19.06 million coins multiplied by the current going price of $23k.
Lost private keys I get (but we don't know for sure how much are lost, we can only take a guess based on wallets that haven't had activity in a decade, I'm sure it's a decent percent of those but not all of them), but I'm not following on the other examples. Why would those others make a difference?
There's intrinsic value to, say, McDonalds, because they own something like 50k acres of prime retail real estate. The same is not true for a cryptocurrency coin.
Intrinsic value is an interesting term, but say we are not talking about McDonalds, but rather say Acacia Research ( ticker: ACTG ). Is their value intrinsic or imaginary? Without going down the rabbit hole of what is 'value' rabbit hole, the argument of value ( intrinsic or not ) may not hold much; mostly because value is what is valuable at a given time.
You will find not argument from me saying that crypto has tons of scams going, but.. quite honestly, same is true in regular finance. Traditional finance is just more regulated. And, before we get to that point in other posts, it seems like crypto regulation was just hatched the other day.
I don't think market cap is really the best metric to look at for the meaningful "size" of a speculation-driven market like cryptocurrency. Admittedly, I'm far from the most financially-savvy, but it seems to me that more relevant figures are the number of people invested in the market and the percentage of people's income/wealth invested in it.
Actually, probably even more relevant (though more difficult to measure) than the absolute number of people invested in the market is some kind of measure of the "distribution" or "spread" of such people—something like distinct groups of people without direct connections to each other, since (positive) interest in cryptocurrency seems to cluster somewhat based on word of mouth networks.
Would actually be an interesting kind of study to do, finding the most useful ways to measure the "size" of a market of this nature. I would guess that there are probably at least 2-3 different measures of "size" that would be relevant to different kinds of effects on the market, but I'm afraid that's about where my understanding of all this ends.
Because it's a relatively small eco system and everything is tied together. As soon as one domino is falling the whole eco system follows.
And look at the graph of the top 20 cryptos, they all follow the exact same graph as BTC. Anything bad happening at a relatively large scale to BTC = BTC goes down = the whole crypto world panics = they all go down