This week, Bitcoin crashed by 50%. Videos spread across TikTok and Twitter of college age men crying as the money that was supposed to go toward tuition was instead evaporated. The market is in chaos. Yet this is nothing for the cryptocurrency asset class.

Here’s why the crash was so impactful despite the percentages themselves being a walk in the park in Bitcoin terms, and why the first ever cryptocurrency is no longer for everyone.

Satoshi Nakamoto‘s vision for the first ever form of peer-to-peer digital cash was ambitious. He, she, or they sought to create a technology that allowed everyone and anyone to be their own bank – without the need for an intermediary.

The goal was to remove the government and central bank’s influence over money. Satoshi also aimed to make Bitcoin scarce and collectible, instilling certain attributes of digital gold.

Related Reading | Guggenheim CIO Compares Crypto To Tulips, Why He May Not Be Wrong

Somehow they also designed the halving to cause a bubble-effect due to the imbalance of supply and demand that would suck participants into the network with each new wave.

And it is all working, even without the creator themselves still around to support it. However, one positive aspect of the coin is now working against another, making Bitcoin not as much for everyone these days as it once was.

Bitcoin price drops have been far more severe in the past on a percentage basis, but dollar for dollar, this is the worst ever.

Satoshi made the cryptocurrency scarce, with a supply of only 21 million BTC and far less in circulation. As the network effect and each bubble phase sucks in more users, the price per coin rises in a dramatic fashion.

As price discovery takes place and the coin is repriced higher forever more, it also means that corrections get far more dangerous on a dollar per dollar basis.

Back in the day when Bitcoin was only a few hundred dollars per coin, losing a couple hundred per coin hurt, but didn’t break the bank. It wasn’t until the peak of the 2017 bull market when corrections got especially nasty, dropping from by $14,000 from the high in 2017 to the first major 2018 low just a month or two later.

Funny seeing all #btc haters come out of hibernation to post, “I told you so..” While it’s still up from a less than a penny to $64k… I think volatility is granted with these kinds of returns. This asset class is not for everyone. Put your phone down and take a breather. Peace!

— Ali Akhmatov (@AkhmatovAli) May 20, 2021

The fall was a full 70% in just days – but still not the worst that Bitcoin has seen. Neither was the most recent selloff percentage wise. In fact, it was one of the smallest comparatively.

However, because of just how expensive each coin is today, the drop did far more damage on a dollar per dollar basis, wiping out $28,000 per BTC.

Withstanding losses of this magnitude might not be something individual investors can handle at current prices, and even one crash could leave someone bankrupt.

Related Reading | SEC Warns Investors Of “Highly Speculative” Bitcoin Risk

At these high prices, Bitcoin is sadly no longer for everyone. Institutions have come into crypto as the community always wanted, but now the asset class is theirs. That type of investors has a much longer investment horizon, and can withstand enormous drawdowns without a second thought.

Unless you can do the same, Bitcoin might no longer be for you.

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