The world of crypto moves fast. During lockdown, it was hard to have a conversation without someone bringing up Bitcoin or Dogecoin. Social media was consumed by it too, with everyone pumping something crypto-related. It took less than 3 months for Bitcoin to go from $30k to a high of $64k on April 13th. In 2 months after that, the price came crashing down (nearly 50%) and is hovering at $33k.
While the internet will have you believe everyone has "diamond hands" (aka not selling), Blockchain data shows people are aggressively cashing out. Addresses holding 10k+ Bitcoin have fallen ~15% since January. Other currencies have fallen from highs too, Doge is down 70% from its high just a month ago, while Ethereum is down nearly 55% from its high on May 11th. The crypto craze and FOMO investing has cooled off. (for now at least)
Governments are cracking down hard on crypto as well, with China winning the gold medal in the measures it has taken. (doesn't look like the massive country of El Salvador making Bitcoin legal tender had any meaningful impact on it) Elon Musk seems to have gone awfully quiet on crypto too, focusing his attention back to pumping Tesla. Bitcoins are disappearing mysteriously as well, and the ransomware attacks have not helped either.
Short Squeez Takeaway: Will cryptocurrencies bounce back? Yes, they probably will. Maybe Elon Musk will start tweeting about them again or Cathie Wood will raise her Bitcoin price target from $500k to a $1 million. While crypto investing for sure is hella fun, every now and then you are likely to go into severe depression.