The stock market fell into a bear market on Monday, but as badly as stocks are getting hammered, the cryptocurrency sector is getting hammered even harder. The fallout continued Tuesday, as Coinbase—the largest cryptocurrency exchange in the US—announced it was cutting 18% of its workforce, reports the Wall Street Journal. Coinbase will have about 5,000 employees when the layoffs are done. The move comes with bitcoin in free fall, falling close to $20,000 per coin, down about 70% from its November high near $70,000, per CNN. Another big crypto coin, ethereum, is in similar straits.
The crypto world's turmoil accelerated on Monday when the UK-based Celsius Network suspended withdrawals and transfers due to "extreme market conditions." Binance, the world's biggest crypto exchange, also suspended withdrawals on Monday, though only for a few hours. One sliver of hope for crypto investors: Sector veteran Mike Novogratz tells CNBC that "we've gone to the level that should be close to a bottom—$21,000 bitcoin, $1,000 ethereum. There's been a tremendous amount of capitulation and fear."
The Street notes that longtime crypto investors are used to this type of roller coaster, though this time, the fall has been "much sharper and starker." Many now face the tough decision of whether to bail or "HODL," crypto slang for holding onto coins. Economist Peter Schiff, a fierce crypto critic, has an I-told-you-so vibe with a tweet that upends a common refrain among bitcoin supporters that it's "going to the moon" in value. "It looks like #Bitcoin is going to the moon after all," Schiff wrote. "The problem for #HODLers is that it started its journey on Pluto. After it shoots past the moon, it's headed straight for Earth. Just don't look for a soft landing!" (More cryptocurrency stories.)
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