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What is TITAN and why has the price crashed?

TITAN is one of the latest cryptocurrencies to hit the market - but its price has crashed in the past 24 hours.

We explain what you need to know about the crypto and why its price is diving.

But first, a word of warning: buying cryptocurrencies, like any investment, is a very risky business and making money is never guaranteed.

Before you invest, make sure you know the risks and that you can afford to lose any money you put in.

As evidenced by the TITAN crash, cryptocurrencies are highly volatile, so the value of your cash can go down as well as up in the blink of an eye.

Newer cryptocurencies are also typically riskier than older ones, such as Bitcoin, and make you more open to scams.

5 risks of crypto investments

BELOW we round up five risks of investing in cryptocurrencies.

What is TITAN?

TITAN, also known as the IRON Titanium Token, is a cryptocurrency that operates on the Polygon platform.

The token belongs to Iron Finance, which runs the wider IRON Stablecoin project.

This, in turn, aims to avoid price volatility.

The Polygon network aims to provide faster and cheaper transactions on the Ethereum blockchain and to make the latter a multi-chain system.

Why has the price of TITAN crashed?

The price of TITAN is currently sitting at $0.000000043347, down by 100% over the past 24 hours, according to CoinGecko.

In comparison, it was worth $64.04 at its peak yesterday.

The way the project functions is that when new IRON stablecoins are minted, the demand for TITAN increases, which pushes up its price.

However, when the price of TITAN starts to fall, the price dives.

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, told The Sun: "The complex arrangements surrounding how this decentralised finance project functioned meant that an initial small wobble in the price of TITAN led to the crash.

"It’s ironic that the rug was pulled from under TITAN in such a dramatic fashion, given that it was linked to an IRON token, which is a type of stablecoin.

"Stablecoins are meant to limit price volatility as they are pegged to a traditional currency or commodity."

The price dive also hit billionaire investor Mark Cuban, according to a tweet by himself.

What are the risks of investing in cryptocurrencies?

Investing in cryptocurrencies is essentially gambling and there are no guarantees that you will see what you pay in go up in value.

Cryptocurrencies are VERY high risk and a speculative investment, with limited track records and no underlying value.

There is also no guarantee that you can convert crypto assests back into cash, as it may depend on the demand and supply in the existing market. 

Cryptocurrency firms aren't regulated in the way that other financial firms are, meaning you won't have any protection if things go wrong.

As always, you should never invest in something you don't understand.

Ms Streeter added: "TITAN should be held up as a warning sign for crypto investors showing just how quickly an asset can fall in value.

"Traders should be aware that these new corners of the crypto market in particular are not just nascent but highly volatile, so they should proceed with extreme caution."

While Myron Jobson, personal finance campaigner of Interactive Investor, told The Sun: "The high-risk nature of these cryptocurrencies is not something that is easily understood by even the most experienced investors.

"Overall, most investors’ needs can and should be met by straightforward, mass-market investments."

Bitcoin's value soared this week after Elon Musk revealed Tesla WILL allow transactions with the crypto once it becomes cleaner and greener.

It comes after it crashed last month when he withdrew his support for it citing the harmful effects to the environment that comes with mining.

We explain what you need to know about Theta and why the price is going up.

El Salvador makes history by being first country to approve BITCOIN as legal tender

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