Virtual money or real money are essentially things that are recognized by people as valuable. However, for real money, this recognition process is conducted by the state. Currency is a tool for socio-economic management. Therefore, maintaining the stability of the currency is an important task.
As for cryptocurrency, this recognition process is conducted by "a group of users" - an entity that literally has no power over each member. In addition, for this entity, the more expensive the virtual currency, the more beneficial it is for the majority of its members, because in the end, they still want to exchange for real money to make a profit.
Therefore, although the nature is similar, the operation of these two currencies is very different. Real money has governing monetary policies. And the "virtual currency user group" has no tools to save its value but exhortation and belief. When the currency fell, they stepped on each other again, to sell off, trust then was not worth three cents.
If compared with gold, it can be seen that in addition to being used as a currency, there are countless other practical applications such as jewelry, industry, and medicine. Meanwhile, what use is virtual money other than speculation? Of course, you can't use it as currency, because no one dares to buy Bitcoin when the price changes every minute.
The leading cryptocurrency suddenly “free fall”
The top 10 cryptocurrencies – including Stablecoins, Bitcoin, Ethereum, BNB, XRP, Solana or Cardano – have been in free fall, losing their value miserably within the past few days.
Stablecoin Luna free-falled from $118 to $0.09 over the course of a month. This drop is unusual, out of control and unpredictable. Some experts warn that the "ripple" effect is just beginning while others try to calm the market.
Stablecoin works on Blockchain technology, it is gaining attention in recent years due to its flexibility, speed and fixed value. It is usually set at around 1 USD per token. Called "digital USD", they have become popular assets for many people and financial institutions around the world.
The collapse of stablecoin Luna created a panic and made it difficult for the public perception and belief in the idea of the stablecoin concept. Tether, USDT - the largest stablecoin on the market - lost 5% of its value, dropping from 1 USD to 95 cents.
Nicholas Bonnet, an Aplo crypto broker, told CNBC that traders are exploiting Tether’s drop “basically buying the token for less than $1 and then exchanging it for a dollar.”
Tether chief technology officer Paolo Ardoino has been trying to reassure the market, ensuring all Tether holders will always receive $1 in tokens when they withdraw them, according to CNBC. He added 300 million Tether tokens were withdrawn in the last 24 hours. The price of other stable coins like DAI or USDC, remains at 1 USD. The
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