As Bitcoin and Dogecoin plummet, Mark Cuban dubs the cryptocurrency crash the “Great Unwind.”
The collapse of cryptocurrencies, which has seen Bitcoin, Dogecoin, and Ethereum all plunge, has been dubbed the “Great Unwind” by billionaire entrepreneur Mark Cuban.
Many famous cryptocurrencies have seen a significant drop in value in recent weeks. Bitcoin’s price has dropped from over $46,000 a week ago to under $33,000 at the time of publishing. Dogecoin has also plummeted, falling from north of $0.50 on May 16 to less than $0.30 today, while Ethereum has dropped from over $3,500 last week to hovering about $2,000 today.
“I believe we are in the midst of the ‘Great Unwind.’ Traders borrowed to buy Eth, then used Eth to borrow an alt/stable coin, LP a high APY pair, and stake the SLPs to maximize yield. They had to Unwind the moment Eth reached their Tragic Number. On Sunday, Cuban, who is worth $4.4 billion according to Forbes, tweeted, “Unstake, Remove Liqudity, Repay.”
The billionaire is best known for being one of the biggest “shark-investors” on ABC’s hit reality show Shark Tank. Cuban also owns the Dallas Mavericks of the NBA.
It gets much worse when a Double Tragic Number hits those who have been in for a long time and did not expect to be struck. When they are struck, much of the dry powder that was used to maintain support levels is unwound as well. As a result, new funds will be needed.
May 23, 2021 — Mark Cuban (@mcuban)
Cuban reacted to a post by Larry Cermak, the director of research at The Block, which bills itself as the “first and final word in digital properties.” “The implication of doing 1:1 forks of Ethereum projects but on all the other competing L1s are actually larger than people know,” Cermak wrote in a February update. Also on Ethereum, there are a shitload of L1s and valuations are still spread out. The dilution of buyers and capital, in my opinion, can lead to serious problems.”
Captioning his retweet, Cermak added: “This took much longer than I thought but IMO a big reason for why we’re seeing 60% super quick crashes is that there was just way too many projects stretched to crazy. This is a condensed version of the information.