Rekt is a slang term derived from the English word ‘wrecked,’ which means something that has been entirely damaged. Rekt may be used in the same context as ‘wrecked’ to mean something has undergone severe damage and is obliterated. Although the term is used widely, the slang term is used primarily by gamers relating to someone severely defeated.
Rekt can also be used in digital assets such as Non-Fungible Tokens and Cryptocurrencies. In the virtual world of blockchain technology, rekt is used to explain an incident where investors incurred severe financial damage caused by poor investment decisions.
Real-World Applications of ‘Getting Rekt’
For one to incur heavy financial losses, the party involved may have taken a tremendous risk on a bet that did not fall out as planned. For instance, when trading crypto assets on margin, a disclaimer is issued to educate users on the importance of managing risks when trading. If an individual takes a substantial amount of risk, and the trade happens to go in the opposite direction to their expectation, the party becomes rekt.
3AC Got Rekt
Alternatively, people let their greed go too far by betting on an ecosystem with all that they got to turn dimes into millions overnight. The victims are not limited to enterprising retail investors. Some vast companies suffer the same fate upon making significant financial decisions using capital from investors. For instance, Three Arrows Capital filed for bankruptcy upon the Terra Luna crash. 3AC had invested $500 million in the ecosystem, which after the crash is now worth less than $500. The Singapore-based crypto hedge fund got rekt.
Taiwanese man loses $2 million.
The Terra Luna crash narrowed the eyebrows of the crypto community upon crashing. A Taiwanese man reportedly committed suicide after losing more than 60 million dollars. Unfortunately, the man ended his own life after being rekt. In two days, his $2 million investment fell to less than $1000.
The term may also be applied to cryptocurrency projects that failed or have lost their value drastically. For the Terra Luna case, Luna got rekt. Since Luna was connected algorithmically to the UST stablecoin, UST got rekt.
Squid Game’s Rug Pull
Squid Game’s Rug pulls ended in investors being rekt millions of dollars after the project’s scammers prevented investors from withdrawing their investments in the name of an anti-dump system. All these turned out to be big lies as the scheme robbed millions of dollars. The anti-dump mechanism prevented investors from withdrawing their deposits to prevent prices from crashing. However, scammers took this advantage and cashed out on the oblivious investors. The investors sadly got rekt.
At the beginning of 2018, Bitcoin was rekted. However, the risk was temporary. In 2020, not only did Bitcoin bounce back, but it also created new all-time highs. With the bearish sentiment in the crypto market, most projects are being rekt and have been facing severe challenges since the year began. Bitcoin’s price fell from an all-time high of about $69,000 to below $20,000, bringing the entire crypto market down as well. The total estimated value lost in the market is estimated to be close to $2.2 trillion.
Back in early 2018, Bitcoin was rekted, yet near the end of 2020, not only did it bounce back, but it also reached a new all-time high.