i'm not a smart man and i know nothing about the economy, so someone explain this to me: if people lost 1.7 trillion bucks on crypto, didn't other people gain that much and it evens out? or does it mean there is such a significant number of people who went flat broke it will have wide-ranging effects?
Lets say its a small market. 9 of them (including Jon) paid $1.
Adam comes in and bids $1.25, and buys one from one Jon.
Jon says I want it back, and pays Adam $1.50.
Adam says I want it back and pays Jon $2.00
They continue doing this for awhile until Adam is willing to pay $100.
So now Bitcoin is valued at $100, and the market value is $100x10 = $1,000 when it was previously $1x10 = $10
But when Adam tries to sell, no one takes it. He keeps reducing the price until its back to $1 and Jon is willing to buy.
Market collapsed from $1,000 back to $10.
But those other 9 people didnt gain or lose anything. The only money lost was Adam ($100) and the only gained was Jon.
Housing was very different because A: most people have a house, and B, the real issue was the subprime mortgage scandal/crisis in which the people left holding the bags were giant banks and not individual dumbasses.
