I’d say the latter because what you end up with is much more relatively closer to zero. Of course you weren’t losing much in the first place so there’s plenty of argument for the former as well.

That latter argument ignores the marginal utility of dollars. It is a mental illness to think going from 2 to 1 billion is worse than going from 2k to 1k

The marginal utility of money is a real thing, but it applies to purchase of life basics, like goods, services, and security.

The marginal utility of money for power and influence in our societies seems to start a few orders of magnitude above the upper middle class, and so far doesn't seem to bend down very much as money increases.

To be fair, to "lose" billions of dollars. Really means putting that money into the economy without any immediate return. Which kinda sounds like a good thing?

Inefficient allocation of capital doesn't sound like a good thing to me.

Maybe it wasn't so well allocated if it was gone this fast.

When the valuation drops those money just evaporates. They don’t go into economy.