{"id":5215,"date":"2022-07-04T12:07:23","date_gmt":"2022-07-04T12:07:23","guid":{"rendered":"https:\/\/blog.researchandranking.com\/?p=5215"},"modified":"2025-11-06T23:56:43","modified_gmt":"2025-11-06T18:26:43","slug":"crypto-meltdown-speedup-digital-rupee","status":"publish","type":"post","link":"https:\/\/www.equentis.com\/blog\/crypto-meltdown-speedup-digital-rupee\/","title":{"rendered":"Crypto Meltdown: Should RBI Speed Up The Launch Of Digital Rupee This Year?"},"content":{"rendered":"
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Should RBI Launch Digital Rupee This Year: Cryptocurrencies have quickly become a hard-to-ignore asset class. Despite high volatility in their prices, millions of Indians are investing and trading in crypto today. And why would they not when Cryptocurrencies have outperformed every other traditional asset class by a large margin over the long term. <\/p>\n\n\n\n

But it seems like the crypto market has run out of steam now. Bitcoin, the world’s biggest cryptocurrency, has dropped over 70% from its peak. And the total cryptocurrency market cap is below the $900bn level after touching a high of $2.9 trillion in Nov 2021. <\/p>\n\n\n\n

So, what happened in the crypto market? And is it the right time for the RBI to push for the early launch of the digital rupee? Let’s find out.  <\/p>\n\n\n\n

The Story of the Cryptocurrency Market Crash <\/a><\/strong><\/h2>\n\n\n\n

On November 8th, 2021, bitcoin touched an all-time high of $68,789. It was a dream run for the crypto market, especially after two years of crypto winter.  However, starting in 2022, the market experienced some headwinds due to profit bookings, global<\/a> macro developments, worsening geopolitics, and new regulations and taxes levied in India and the US.<\/p>\n\n\n\n

Moreover, China’s ban on crypto trading and mining wiped out 40% of the market in a month. Furthermore, things worsened when the Terra Network, the second-largest DeFi protocol in the market, collapsed, wiping nearly $60 billion of investors’ wealth in a few days.<\/p>\n\n\n\n

It led to panic selling and solvency issues in multiple leading DeFi lending protocols, resulting in the further downfall of the market.<\/p>\n\n\n\n

BTC- S&P 500 Correlation<\/strong><\/h3>\n\n\n\n

Bitcoin and the crypto market may be unrelated to the global financial market, but recent trends highly correlate with major US indices. In June 2022, the BTC-S&P 500 and BTC-NASDAQ correlation remained high.<\/p>\n\n\n\n

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On June 30th, 2022, the 30-day BTC-S&P 500 and BTC-NASDAQ correlation stood at 0.85 and 0.76, respectively.<\/p>\n\n\n\n

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The daily price chart of BTC and NASDAQ<\/a> above showcases similar price movements. Besides the internal shocks, global macro developments currently influence the crypto market. For example, the global liquidity scenario, the US inflation<\/a> data, and US GDP data also impact the crypto market significantly.<\/p>\n\n\n\n

Future of Cryptocurrency<\/strong><\/h2>\n\n\n\n

From initial rejection to getting recognized as an asset class, bitcoin has come a long way and is much stronger and decentralized.<\/p>\n\n\n\n

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The chart above showcases the computing power of the Bitcoin blockchain<\/a> network, which is at 214.21m Tera hashes per second. To give you a perspective, the world’s fastest supercomputer, Fugaku, has a computing power of 442,010 Teraflop per second, just a fraction of the Bitcoin Network’s computing power.<\/p>\n\n\n\n

The recent crash is the fifth major reset of the crypto market. In the 2018 market reset, bitcoin lost close to 80% of its value, dropping from $19,783 to $3,200.<\/p>\n\n\n\n

About the future of cryptocurrency<\/a>, a lot depends on the following factors:<\/p>\n\n\n\n