NEW YORK -- It's been a wild week in crypto, even by crypto standards. Bitcoin tumbled, stablecoins were anything but stable and one of the crypto industry's highest-profile companies lost a third of its market value. Here's a look at some major developments in cryptocurrencies this week:
BITCOIN: The price of bitcoin dropped to around $25,420 this week, its lowest level since December 2020, according to CoinDesk. It steadied around $30,000 Friday. Bitcoin has dropped about 37% year to date. Ethereum has dropped 44% and dogecoin, a cryptocurrency favored by Tesla CEO Elon Musk, has fallen 53%.
STABLECOIN COLLAPSE: Stablecoins have been viewed as a safe haven among cryptocurrencies. That's because the value of many stablecoins is pegged to a government-backed currency, such as the U.S. dollar, or precious metals such as gold. But this week one of the more widely used stablecoins, Terra, experienced the cryptocurrency equivalent of a run on the bank. Efforts by Terra's developers to shore up liquidity failed. On Friday, Terra had fallen to 14 cents.
COINBASE: Coinbase lost about a third of its value this week, during which the cryptocurrency trading platform reported that active monthly users fell by 19% in the first quarter amid the decline in crypto values. Investors had been running for the exits even before Coinbase reported a $430 million quarterly loss. Shares closed Friday at $67.87. On the day of its initial public offering just 13 months ago, shares reached $429.
REGULATORS: There has been a lot of talk about regulating cryptocurrencies, but little in the way of action. Treasury Secretary Janet Yellen said Thursday the U.S. needs a regulatory framework to guard against the risks surrounding cryptocurrencies and stablecoins. On Monday, before the implosion of Terra, the Fed said stablecoins are vulnerable to “runs” that could harm owners of the coins.