Shares of Facebook, Amazon, Apple, Netflix and Google have collectively lost more than $1 trillion in market capitalization. dollars. Collapsed from their all-time highs, marking an even greater loss in dollar terms than all cryptocurrencies combined in 2018.
For comparison, despite a difficult year for digital assets, the total market capitalization of cryptocurrencies has decreased by about 700 billion dollars from its historical high of 830 billion in January 2018.
FAANG is an acronym from the first letters of the five most successful high-tech companies: Facebook, Amazon, Apple, Netflix and Google, which the media has dubbed the most popular giants and record holders of investor sympathy. Record-high valuations for FAANG stocks were an impressive bull run in the first half of this year, which appears to have peaked in July. Interestingly, this month was also the last time Bitcoin (BTC) saw prices above $8,000.
Rumors of Bitcoin's death appear to be greatly exaggerated, especially given the 85% drop in the FAANG capitalization.
On the other hand, slowing economic growth around the world may be a sign of the impending financial crisis, which in 2008 gave rise to Bitcoin as a decentralized and apolitical alternative to the existing financial system.
Former investor and Wall Street market analyst Max Kaiser recently stated that Bitcoin was, in fact, designed to thrive in times of economic turmoil. He explained:
Bitcoin adoption has always been driven by bank failures, sanctions and political unrest. The problem that Bitcoin has been facing lately is that its competitor, the US dollar, is rising. Ten years after its birth, it will be interesting to see whether Bitcoin, which is neither a stock nor a security but a digital protocol for transferring value, can eventually decouple from traditional markets and become a safe haven during the next cycle of bankruptcies.
Fundstrat Global Advisors head of research Tom Lee, meanwhile, called BTC undervalued given that its fundamentals are as strong as ever.
Bitcoin's fair value ranges from 13 800 to $14,800.
So a market correction could be beneficial for cryptocurrencies as the number of unprofitable businesses and low-quality projects increases.
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