Does the cryptocurrency crash pose a threat to the financial system?

On Tuesday, Bitcoin fell briefly below $30,000 for the first time in 10 months, while cryptocurrencies overall have lost nearly $800 billion in market value in the past month

In November, the most popular cryptocurrency, bitcoin, hit an all-time high of more than $68,000, pushing the value of the crypto market to $3 trillion

That figure was $1.51 trillion on Tuesday.

COULD A CRYPTO CRASH HURT THE FINANCIAL SYSTEM?

Coinbase, the world's largest cryptocurrency exchange, said institutional and retail investors each accounted for about 50% of the assets on its platform in the fourth quarter

Its institutional clients traded $1.14 trillion in crypto in 2021, up from just $120 billion in 2020, Coinbase said.

Approximately 14% of Americans were invested in digital assets as of 2021, according to University of Chicago research.

on Monday, when TerraUSD, a major stablecoin, broke its 1:1 peg to the dollar and fell as low as $0.67, according to CoinGecko

That move partly contributed to bitcoin's fall.

regulators overall are divided on the size of the threat a crypto crash poses to the financial system and broader economy.