What happened 

The cryptocurrency industry is having a rough day as nearly every asset is down double digits or more. Some of the smaller utility tokens are down big even after bouncing off their lows in the last few hours. 

As of 2 p.m. ET, over the last 24 hours, Solana (SOL -4.49%) is down 15.2%, Cardano (ADA -10.50%) has fallen 10.4%, and Polkadot (DOT -10.57%) has dropped 10.4%. 

So what 

The biggest news today is that the Celsius Network, which is a decentralized finance application, has frozen transfers and withdrawals because of market volatility. That's caused a panic in the market because users can't sell out of positions and can't even pay off loans that may be out on the platform. 

Binance, which is the world's largest cryptocurrency exchange, also paused Bitcoin withdrawals because of a "stuck transaction." Add both of these news items together and investors are understandably worried that the decentralized nature of some of these products may not be as safe as they once thought. 

It's worth pointing out the crypto industry is still relatively young and grew rapidly in the last few years, but hasn't been stress tested like it is right now. Stablecoins are under pressure, decentralized finance protocols are failing, and even Bitcoin is falling. If you're an investor it can seem there's nowhere to turn. 

Now what 

The cryptocurrency industry has grown at an explosive rate over the last two years in part because of all of the trading money that's been brought into the industry. But that trend has reversed as the stock market has fallen, the Federal Reserve has raised interest rates and reduced quantitative easing, and crypto has started to show more cracks. 

What Solana, Cardano, and Polkadot have in common is they're utility tokens and developers can use their blockchains to build digital utility. This can be anything from decentralized finance projects to non-fungible tokens (NFTs). But the industry is very early in developing these business models and the value of these cryptocurrencies have likely gotten out ahead of where the blockchain development was. 

With that said, I think it's important to point out that billions of dollars are going to be flowing into cryptocurrency and the Web3 project over the next few years and there's likely to be immense value build, just like when the internet was in its infancy in the 1990s. It will take time, but patient investors who are adding exposure to leading cryptocurrencies will be winners over the long term. 

It's not clear where the bottom for crypto values is, though, and this sell-off could last much longer. For now, fear has taken over the market and if that continues cryptocurrency valuations could continue to drop.