As cryptocurrencies continue to suffer significant drops, concerns over the crash and drastic losses are mounting online.

One cryptocurrency which has seen a price drop this week is Ether. Ether is a popular cryptocurrency, similar to Bitcoin, and is powered by the community-run technology known as Ethereum.

Here is everything we know about current price drops, why is Ethereum crashing, and what we can expect going forward…

Ethereum prices drop drastically – why is it crashing?

Prices of ether have been dropping as the entire crypto market is seeing a crash happen. In the last 24 hours, ether has lost more than 20%, with its price dropping to below $2,000.

However, it is not just Ethereum that is losing its value. Bitcoin fell to $25,000 on Thursday morning, which is its lowest point of the year. iNews has reported that Bitcoin has recovered to $28,000 as of Thursday afternoon.

Other currencies such as XRP, Solana, Cardano, Dogecoin, Shiba Inu and Avalanche have also suffered drops. Across the various currencies, they’ve lost at least 25% of their value.

Photo by INA FASSBENDER/AFP via Getty Images

Why is crypto crashing?

Coinbase, the largest crypto exchange in the US, suffered a 15.6% drop in shares this week. It explained net losses of $430 million were due to the “trend of both lower crypto asset prices and volatility that began in late 2021.”

The current crypto crash can also be explained through an email written by Yuya Hasegawa, a crypto market analyst at Bitbank. The email, which was seen by Forbes, states:

“The price of bitcoin, however, could still fall due to the UST situation and worsening technical sentiment, but if the U.S. inflation continues to slow down, the macro environment will likely improve and the price will bottom out.”

The “UST situation” refers to the $18 billion algorithmic stablecoin terraUSD which is known as UST. UST lost its peg to the US dollar, which resulted in the price of its support coin Luna being wiped out. It has lost almost 99% of its value.

Will crypto continue to fall?

Hasegawa has warned that the price of Bitcoin could still fall. But if the US inflation continues to slow down “the macro environment will likely improve and the price will bottom out.”

Tyrone Ross, CEO of Onramp Invest told CNBC that people should “fully expect” crypto to go down further. He therefore advised people to only put in what they can afford to lose so they should “be able to still pay your rent.”

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