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By The Numbers: The Worst Bitcoin Bear Markets Ever

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Bitcoin is now officially in another bear market after the crash that rocked the market last week. After dropping more than 70% from its all-time high, investors around the world have begun to retreat from the digital asset due to this new price trend. However, these trends are not new to bitcoin. While the current market may seem worse than previous ones due to the fact that it is still going on, there have been brutal bear markets in the past.

Blast from the past

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It is often helpful to look at previous Bitcoin market cycles to see that this is not unusual. Yes, the bullish and bearish trends in this market have deviated from what has been recorded in history, but still remains very similar to what has been recorded in the past.

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For bitcoin, alternating bear and bull markets have always been part of the experience. It has gone through several such boom-bust cycles in its 13 years of existence and is not expected to change any time soon.

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Bitcoin is currently down about 73% from the peak of the last cycle, but this is not the first time this has happened. Looking back at the market in November 2013, we see that bitcoin actually continued to decline until it finally ended its 407-day losing streak, bottoming out at 85% of its all-time high. This marked the end of the protracted bull market.

For those in the market, the 2017 bull-bear cycle is fresher in their memory compared to 2013. However, as in 2013, the drawdown was just as brutal, albeit shorter. What lasted for about a year ended up with a poor bottom 84% performance.

bitcoin bear market

BTC bear markets are always brutal | Source: Arcane Research

As the digital asset continues to closely support this trend, the drawdown is expected to continue. Based on the previous two examples, one can easily conclude that the historical move will cause bitcoin to bottom in the mid-80s. So the bottom has most likely not yet hit and the market will most likely see BTC at $11,000 before the expected market bottom at the end of 2022.

Will Bitcoin follow?

While looking at previous moves can help indicate the direction that the price of bitcoin might take, there is always new information and events that can greatly influence it. First, the macroeconomic environment has recently played a major role in the movement of digital assets. As worries about inflation, Fed rate hikes, and reduced liquidity surround the market, it has directly affected Bitcoin.

Bitcoin price chart from TradingView.com

BTC enters bear market | Source: BTCUSD on TradingView.com

This has led to a closer intertwining of the market when it comes to bitcoin and the wider financial markets. As the cryptocurrency space grows larger, it is experiencing greater repercussions from Fed decisions, stock market performance, U.S. elections, and tightening cryptocurrency regulations.

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However, long-term play on bitcoin remains the best bet. As emotions run high, bitcoin veterans start hoarding and hibernating, waiting for the winter to pass. Based on history, the price of bitcoin could reach $200,000 by the next bull market.

Featured image from Forbes, charts from Arcane Research and TradingView.com

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Credit : www.newsbtc.com

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