This week, the cryptocurrency market saw a crash unlike many before it — one that ripped down the value of major coins like Bitcoin and Etherium, as well as alternative crypto options that had been lauded for their stability. Chief among them was TerraUSD and its sister coin, Luna — a relationship built on financial symbiosis, and one that had proven incredibly profitable for investors over the last year.
TerraUSD and Luna’s combined crash is so bad that it’s impacted other cryptocurrencies and financial markets, and it’s looking likely that Luna will never bounce back. As the value of these coins plummeted, many took to social media to look for solace. And as we saw in the 2008 housing crash, it became obvious that many people had lost their life savings, and were nearing wits’ end.
Then came the posts about people considering suicide.
Many of the initial posts came on the original r/TerraLuna Reddit page, but after the moderators locked the forum to new posts, some members started a new page, dubbed r/TerraLunaVictims. It’s become a nexus for people to find reassurance, even if they don’t feel the need to call a National Suicide Hotline just yet. The crash inspired investors to open up about their own struggles and losses, adding emotional resonance to a community that, at least on social media, rarely discusses mental health in relation to finance.
“I just stood there, staring at the numbers in complete disbelief. $2,300 it read. Down from a high of $200,000. After a few minutes of digesting the situation, I came to the realization that everything I had worked for, all those endless nights and days praying to retire early, were all in vain. And that was just the beginning of my death spiral,” one TerraUSD investor wrote. “To those that have been affected, I am truly sorry and empathize with you. If anyone needs to talk, or a shoulder for support, my messages are always open for you.”
Some posters have chosen to take this moment to mock people who have lost money, claiming they should’ve known better or can regain their losses elsewhere. But others are reading the situation differently, realizing they’re on the front lines of a mental health crisis that will cost lives. Some have taken to Reddit to offer resources for no-cost counseling, started a live chat on r/TerraLunaVictims for venting and advice and reached out to people who seem vulnerable in their posts.
“This is a difficult time. Knowing the time difference is 8 hours for us, feel free to message me and we can talk,” one person wrote in a reply to a devastated poster.
“How are you doing today? You are never alone. Lots of people are here for you,” another added on a different thread posted today.
This week reminds us that, as with every other major financial crash, there are real victims, and they exist on a spectrum, from everyday people who decided to quietly gamble their life savings on the crypto boom, to the ultra-wealthy and connected who know how to play the game. It’s not merely a matter of people who bought into crypto being ignorant or foolish, as some noisy critics keep saying; indeed, TerraUSD became a top-10 coin because it was billed as more stable than other options.
We saw in the 2008 housing crash that millions of Americans had been swindled by false promises during a rising market, consenting to mortgages and terms that were dangerously risky. We don’t blame money-strapped people for taking bad deals from hustlers who knew they could get rich off fees — they are victims of the modern American dream, complete with the glaring lack of financial literacy across the board. There’s a reason why so many people are, as one Redditor writes, “throwing pennies at cryptos hoping it’ll make me not poor some day… feels like it’s going to be my only way out of living paycheck to paycheck.”
This is how the system works: By promising utopia and hoping the masses don’t spot the cracks in the dream. Now that it’s cracked all the way open, people are forced to confront an existential crisis: They’re not the trailblazing hustlers that accrued thousands thanks to a smart gamble. They’re victims of that gamble, with nothing but a mountain of shame in their wake.
Research continues to demonstrate the human toll of economic crises, which trigger serious mental health disorders such as depression, has been linked to surges in suicide attempts and substance abuse. It’s difficult to calculate the non-financial costs of major crashes, but what is obvious is the sheer emotional impact it has on a wide swath of men, who comprise a disproportionately large portion of the crypto-investor demographic.
Given that men already struggle to seek help with their mental health for myriad reasons, the crypto crash presents a dangerous mix of personal blame, cultural shame and isolation for a person to confront in the wake of losing financial security overnight. And seeking help isn’t just a matter of calling a single hotline — pulling your way out of economic ruin is a grueling process, and there’s little sympathy to be found from those who don’t understand crypto, or criticize by saying the people who lost big did it to themselves. It’s all a disastrous proposition for a health-care system that lacks resources for nuanced, long-term care.
It also can’t be overstated how inevitable this was. Much has been written about pump-and-dump schemes in crypto, and how those with power in the industry are able to use inside information to outsmart rubes. But beyond the capacity for exploitation, it must also be noted that volatility is inherent to cryptocurrency as it exists today. It’s one thing for hedge funds and the Peter Thiels of the world to wade into these churning waters. But it’s becoming more obvious that the vision shilled by the crypto industry and its well-paid cheerleaders — we see you, Matt Damon — can just rot into nothingness, leaving devastating impacts for individuals.
Much scrutiny now falls on Do Kwon, the prickly (and seemingly disgraced) South Korean founder behind TerraUSD and Luna. But there’s as much blood, if not more, on the hands of everyone in the blooming cottage industry that pushes crypto, and especially dodgy “alternative coin” options, on wage workers as a solution to their middling returns. This is an indictment of a system that ties people’s labor, and their self-worth, to the be-all goal of accruing cash. In this context, of course people end up in a crisis when the result of decades of work just disappears, with little safety net remaining other than the absolution of bankruptcy.
There is no shame in the wild west of Web3 technologies and the cynical machinations of crypto startups — not for the people in power, anyway. Despite the claims of a decentralized financial paradise for all, the rise and fall of crypto is leaving a trail of dramatic losses and genuine heartbreak in its wake.
Maybe the silver lining in all of this is that everyday people are helping to pick up the pieces, and hoping they can reach others in time to help. “I’m really sad for all of this. A bunch of kind hearted people saying nice things even when they too lost huge amounts of money,” one Redditor observes. “This brings faith in humanity.”
This story contains mention of suicidal thoughts and ideations. If you are in danger because of similar thoughts, you can call the National Suicide Prevention Lifeline for free at 800-273-8255.
Eddie Kim
Eddie Kim is a features writer based in Los Angeles, covering social and cultural issues for MEL.
