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The first question cryptocurrency owners should ask themselves right now is whether bitcoins, dogcoins and other tokens are safe. Get them in the hands of the wrong dealer or manager, and they can go off into a never-ending cycle of withdrawals, which may never happen.

The second question is closely related: has the price fallen enough to justify a purchase? There is no clear answer, of course, since these are speculative assets with no basis for speculation. But for other speakers and true believers who think that we will all end up using the crypto financial system, it is worth thinking about how investors are prepared for the system crisis. For the rest of us, it fun to watch from the sidelines.

The easiest way is to look at the prices. Since peaking in November, bitcoin has fallen 77% against the dollar, a dramatic decline. Since the first crypto crisis in May, before Sam Bankman-Fried FTX has stepped in to calm things down, bitcoin has almost collapsed. But since the run on FTX that started with CoinDesk report about its hedge funds earlier this month leading to its payout, the price has fallen more than 20%.

There is no way to say for sure how much confidence in the crypto ecosystem has been damaged by the magnitude of the failure. But on a larger scale, the 77% drop in prices is not that far off from the 85% drop in US stocks from the peak to the financial crisis of 2007-2009. Bitcoin is also better than a bank because it itself cannot fail, although the exchanges that allow it to trade seem to fall like dominoes (and unlike banks, they do not have the Federal Reserve to save them). Take that thought, and perhaps most of the loss of faith has already been explained in this process.

The removal of speculators is another proof of this. Some crypto hedge funds have no choice but to stop trading as their funds are locked in a collapsed exchange. Others have chosen to take less risk, which means less money to support the value of crypto.

The proof is, first of all, that there is little demand to borrow crypto assets, because speculators no longer want to take more risks. The interest that can be obtained by lending tether, a "stablecoin" that is pegged to the value of the dollar, has fallen to only 2-3%, less than what can be obtained from the risk-free dollar . There is almost no demand for bitcoin lending, and lending rates on Aave and Compound, two decentralized financial platforms for borrowers and lenders, are close to zero.

Second, advertising in the popular arbitration market has increased dramatically. These are businesses that are successful when investors want to take risks, because the benefits are easy to calculate - for example, using different price values for different crypto groups separate, or buy a publicly traded company that holds shares. . These and other arbitrage transactions are no longer popular because they require a lot of involvement and involve the risk that the counterparty, exchange or listed company will fail.

Third, the number of stablecoins in circulation has decreased as loans are repaid. There was only $65 billion outstanding, down from a peak of $83 billion in May.