- Kyiv residents have been watching with concern as Russia’s military has removed the last few barriers to start bombing their capital city.
- He put the $10,500 sum into terra, a “stable” crypto-token that later crashed in value.
- It’s not just retail investors who were hit by the crypto crash, but more than 5,000 people lost their life savings when a crypto crashed.
The Russian invasion of Ukraine has led to uncertainties within the country, such as currency collapses. Kyiv resident Boris was looking to protect his life-savings of $10,500 from these issues and believed bitcoin would be a safer optiion . As far as cost of living goes, Ukraine was about $467 per person in May.
With oil prices increasing, the organization posted that other commodities would also go up in price making it difficult for people to afford them. Higher inflation and incomes could be swallowed up so demand decreases.
It seemed like the cryptocurrency market had been on a stratospheric ride, so Popovich decided to convert his savings into these digital tokens in order to store the value.
According to the Guardian, one of Kyiv resident’s answers was a form of cryptocurrency called a “stablecoin.” This coin is backed by fiat currency and assets such as government bonds or gold. Theoretically though, this stablecoin has several advantages over other forms of cryptocurrencies including being infinitely divisible and having less volatility.
“It was impossible and unsafe to store funds in the form of banknotes,” Popovich told the outlet. Since stable coins provide low volatility, they’re a great option for investors who want to prevent their investments from losing value due to devaluation.
[Popovich] has chosen a stablecoin called terra. It’s not tied to any hard assets and instead uses algorithms to peg itself to the dollar, euro or yen in that particular periods..
Earlier this month, terra’s algorithm lost its peg to the US dollar, and the stablecoin’s value plummeted.
Within a few weeks of Popovich converting his life savings into terra, the token went into a free fall. In early May, hefty selling of terra forced its value down. That prompted anxious investors to also dump their holdings of terra, creating a collapse within a short period of time.Tuesday, a terra token was *** ONLY *** worth about $0.00017.
Popovich crash took down his savings when terra tokens crashed, and cost him more than just the damage to his account. Terra tokens are now worth only a couple hundred dollar.
Mr. Popovich found that his sleep had disappeared and after 9 pounds, his anxiety and headaches never let up.
Popovich is among thousands of retail investors who have been burned by cryptocurrencies in recent weeks, including those associated with the risk of interest rates and a falling value. The free fall exacerbated fears in the broader cryptocurrency market amid tightening financing conditions..