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Cryptocurrencies fall shocks investors; Youths suffer losses

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KUWAIT CITY, May 18: Cryptocurrencies in 10 days lost $486 billion, equivalent to about 27 percent of their market value, declining from $1.803 trillion on May 5 to 1.317 trillion at the closing of the day before yesterday, according to data from the Coin- MarketCap platform, bringing its decline in a month losing about 564 billion dollars (-29.98 percent) in a month, while its losses in 6 months amounted to 1.49 trillion dollars (-53.08 percent), compared to 2.807 trillion dollars in the closings of November 15 of last year, reports Al-Rai daily. The exorbitant losses made it a legitimate question about the share of Kuwaiti investors in those currencies, whose number has increased significantly during the last period amid a youth onslaught towards this market in the hope of achieving huge profits.

Moreover, an investigative inventory prepared by Al-Rai from the reality of Kuwaiti investors who recorded heavy losses in the week of the collapses suffered by the encrypted digital currencies shows that Kuwaitis lost more than a quarter of the value of their digital currencies at least, while the number increases in the wallets of some when talking about currencies fell by much more than this percentage, including “Luna”, for example, which lost 99.98% of its value within one week, falling from $82 per currency to only $0.009. Perhaps the most telling evidence of this is what one of the Kuwaitis who was stung by the fire of the recent collapse said, as Abu Ahmad confirmed to Al-Rai that he had a quantity of Luna currency worth 2.5 million dollars, which collapsed within a week to reach only 275 dollars.

What makes matters worse for some citizens investing in digital currencies is that they have resorted to borrowing from banks and financial institutions, directing all or part of these loans to the cryptocurrency market, in the hope of achieving quick wealth, while the losses they recently incurred may limit the ability of many of them to commit to repaying the installments of their loans. In this regard, another Kuwaiti investor told Al-Rai that he took a loan of 50,000 dinars to invest into the cryptocurrency market, hoping to make a fortune, but he lost three quarters of this amount in recent days, and said, “I do not reveal a secret if I say that I thought of committing suicide by jumping from the top of Jaber Bridge.”

The inattentive Kuwaiti investors in the cryptocurrency market, are “oblivious investors”, who entered the market by chance, or by imitation of relatives and friends who achieved great returns from this market previously, or by following them through stories through websites and social media, whether real or fabricated, for people who became millionaires in a short period of time after entering the world of cryptocurrency, wishing themselves to become rich overnight.

The same sources confirm that this type of traders are the biggest losers in recent market transactions, noting that they speculate on currencies without clear data justifying their entry into any currency, nor a specific strategy for trades to eventually find himself stuck in large quantities of digital currencies whose prices collapsed, either he sells them at a large loss, or he waits for them to rise again to levels close to their purchase price, which may not come, or be very late. The market value of “Bitcoin” declined by about $ 100.014 billion (-14.37 percent) in 10 days, 174.96 billion in a month (-22.7 percent), and 603.537 billion in 6 months (-50.31%) to close at $596.074 trillion the day before yesterday.

As for Ethereum, which is the second largest cryptocurrency by market value fell by about $72.586 billion (-21.88 percent) in 10 days, 106.92 billion on a monthly basis (-29.2) and 280,224 billion (-51.95%) in 6 months, recording $259.186 billion at the end of trading last Sunday. Perhaps one of the main reasons that led to this violent tremor in the cryptocurrency market is the high turnout of institutional investors such as hedge funds and investment companies to trade in them, after a long period in which individuals controlled their trading, which in turn increased the impact of these currencies on the movement of the global stock market, which notable declines have been recorded recently as a result of investors’ fears that global economic growth will be negatively affected by infl ation and rising interest rates. Also, in times of market uncertainty, traditional investors usually resort to selling assets with a higher risk in their view, such as cryptocurrencies, and switch their money to safer investments.