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Bitcoin whipsaw shows crypto's 'constant state of price discovery' with over $1T lost

Added 01-24-22 07:04:02pm EST - “A brutal Bitcoin sell-off, and a rapid rebound, show how "volatility has become the norm" in crypto.” - News.yahoo.com

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Posted By TheNewsCommenter: From News.yahoo.com: “Bitcoin whipsaw shows crypto's 'constant state of price discovery' with over $1T lost”. Below is an excerpt from the article.

Bitcoin (BTC-USD) suffered yet another brutal bout of risk-aversion on Monday, briefly tumbling by over 5% below $34,000 before staging a recovery as Wall Street rebounded. 

Amid the turmoil, some $130 billion was yanked out of cryptocurrencies between Sunday and Monday, according to Alex Tapscott, Managing Director of Ninepoint Partner's Digital Asset Group.

In the last week alone, Bitcoin shed more than 20% at its troughs, with so-called smart contract currencies faring even worse: Ethereum (ETH-USD) swooned by over 30% within the same period, while Solana (SOL1-USD) has plunged by more than 40%. Outages on the Solana blockchain exacerbated network fees and forced some decentralized finance (DeFi) investors to liquidate their positions.

"Volatility has been the norm historically in digital assets. As an emerging asset class, [crypto's] in a constant state of price discovery," Tapscott said on Monday.

"Through their history, digital assets have become accustomed to and therefore resilient to volatility. Even though Bitcoin has been declared dead in the mainstream media more than 400 times, it keeps coming back," he added.

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