THE world’s richest Bitcoin trader lost $5BILLION in one month as the cryptocurrency’s value continues to plummet.
The anonymous billionaire had 288,130 of the digital coins on Nov 9 which were valued at $19.45bn (£14.7bn).
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However, the same amount of Bitcoin on December 5 was valued ay $14.1bn (£10.6bn) – which is a drop of roughly $5bn.
The trader then decided to dump around $1.5bn-worth of his encrypted stash on December 7 ensuring he is still incredibly wealthy no matter what happens to the currency.
This comes as Bitcoin plummeted a whopping 16.5 per cent on Saturday, shedding a fifth of its trillion dollar value.
Crypto can be riskier than other investments because they are volatile and speculative – their price often rising and falls very quickly, sometimes seemingly for not reason.
Many cryptocurrencies have a short track record, making them difficult to understand and predict.
This type of investment is also not protected by the regulator which means you have no protection if things go wrong.
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Meanwhile, one crypto trader said he lost millions of dollars in just under five minutes.
The anonymous Reddit user claimed he made $1.3million (£900,000) after investing in SQUID, the digital currency inspired by the Netflix series Squid Game.
The cryptocurrency surged to a top price of $2,681 (£2,000) before plummeting to $0.01 – a 99.99% fall over the last month.
Tech website Gizmodo had previously warned that the coin was likely to be a scam, commonly known as “rug pull” that happens when the creators of the new crypto quickly cash out their coins for real money.
The drop comes less than a week after Bitcoin reached a record high of over $69,000 (£52,000).
The sharp fall has wiped around $300billion (£226bn) worth of value from the combined crypto market in just two days.
Bitcoin, the number one cryptocurrency reached a low $51,808.54 (£39,000) market value, according to CoinDesk figures.
All the other major players including ethereum, Binance‘s BNB, solana, cardano and Ripple’s XRP have experienced drops of around 10 per cent.
The omicron variant has also led to risk aversion over concerns about what it might mean for global economic reopening in the coming months.
Global stocks are down more than 4 per cent from a record in November, while haven assets like Treasuries have rallied.
The dollar has also been strengthening against other flat currencies and crypto this week, in part because interest rates are rising to drive down inflation.
The risks of buying with cryptocurrencies
Investing and making a purchase in cryptocurrencies such as Bitcoin is risky .
Their value is highly volatile and City watchdog the Financial Conduct Authority has warned investors should be prepared to lose all their money.
Investing in cryptocurrencies is not a guaranteed way to make money.
You should also think carefully about making purchases with a cryptocurrency.
For example, Bitcoin has had wild price fluctuations in recent months and the price can change on an almost hourly basis.
The price of a Bitcoin was at $40,258 on January 9, according to Coindesk, but fell to $34,214 just three days later.
That’s a 15% drop.
These price swings are risky for a business as you could sell an item for a Bitcoin at one price and the value may drop soon after, leaving you with less money from a sale.
Similarly, the price of Bitcoin has soared by more than 21% since the start of this week so it can be hard for a shopper to get an accurate idea of the price of an item if its value changes on a daily basis.
