Crypto billionaires’ vast wealth destroyed in weeks amid turmoil

livemint.com:

As recently as November, Coinbase Global Inc. founder Brian Armstrong had a personal fortune of $13.7 billion. 

That’s now been reduced to just $2.3 billion, according to the Bloomberg Billionaires Index, as a selloff in digital currencies from Bitcoin to Ether triggers a steep decline in the market value of Coinbase, the largest US cryptocurrency exchange.

The firm’s shares tumbled 78% since their April 2021 initial public offering through Wednesday, and were down another 23% to $56.50 at 12:18 p.m. after the company warned that trading volume and monthly transacting users were expected to be lower in the second quarter than in the first.  

It’s raised questions about Coinbase’s ability to withstand the sharp decline in crypto prices, forcing Armstrong to take to Twitter to defend the company. There is “no risk of bankruptcy" even amid a “black swan" event and users’ funds are safe, said Armstrong, the firm’s chief executive officer.

Billionaire crypto fortunes that swelled over the last two years are disappearing after a selloff that began with tech stocks spilled over into digital money. Bitcoin, the most popular cryptocurrency, and Ether have both fallen more than 50% since their record highs late last year. TerraUSD, an algorithmic stablecoin, is at risk of a complete collapse.

It’s a far cry from just weeks ago, when the crypto crowd was partying in Miami.

While almost all crypto holders have suffered wealth declines, some of the biggest and most visible losses are concentrated among founders of exchanges, where traders buy and sell digital currencies. 

At least on paper, Changpeng Zhao, the CEO of closely held Binance, has lost an even larger fortune than Armstrong. He debuted on the Bloomberg wealth index in