The past year in the digital asset market has been characterized by a series of negative shocks, triggered initially by the collapse of Terra/LUNA, Citi (C) said in a research report Monday looking back on the year.

“Leverage, volatility and interest have faded as investors battle with declining prices,” analysts led by Joseph Ayoub wrote. “Retail interest has broadly diminished as prices have declined,” and this has “coincided with a more general decline in volatility.”

Institutional interest has also declined. This “loss of trust” followed the failure of many centralized entities, and is reflected in exchange-traded-product (ETP) flows, which have remained negative throughout the year, the report said.

Against a broader macro backdrop of inflation concerns, rising interest rates and tightening financial conditions, total crypto market cap has declined by about 61% compared to an 18% drop for the S&P 500 index, the report added.

(By Will Canny)