An article in The Wall Street Journal (WSJ) looks at the aftermath of the recent TerraUSD crash. Investors are now asking if the so-called blue-chip cryptocurrency “was all a get-rich-quick scheme.” Individuals affected by the crash include a surgeon who lost his nest egg, a Ukrainian who lost 90% of his savings and others who have given up dreams of starting new businesses or quitting day jobs.
“All of them were swept up in the mania for TerraUSD, whose total value swelled to $18 billion before collapsing,” WSJ said. It noted that the coin’s sudden downfall is a reminder that crypto “is often little more than a casino.”
Manias involving investments such as TerraUSD are fueled by positively trending social mood. They repeat themselves over time, but their risks are unseen by investors, who typically ignore history and don’t foresee the end of current financial trends.
Peter Kendall, co-editor of The Elliott Wave Financial Forecast, warned of the importance of history and market psychology, which does not change and leads investors to react the same way to the same pressures again and again. To learn more, watch “Peter Kendall on the Advantages of the Wave Principle.”
If you look closely, you can see patterns in social mood that help you predict social trends. Learn more with the Socionomics Premier Membership.