A Temporary Historical past of Bitcoin Crashes and Bear Markets: 2009-2022

bitcoin (BTC) had considered one of its most brutal crashes in 2022, with the BTC price drops below $20,000 in June after peaking at $68,000 in 2021.

June 2022 has change into the worst month for bitcoin since September 2011, when its month-to-month losses amounted to 40%. The cryptocurrency additionally posted its heaviest quarterly losses in 11 years.

Nevertheless, the present market sell-off doesn’t make Bitcoin crashes and bear markets unique to 2022. In truth, Bitcoin has survived its fair proportion of crypto winters because the first Bitcoin block, or genesis block, was launched. mined in January 2009.

As we zoom out of the Bitcoin value chart, Cointelegraph recorded 5 of essentially the most notable value declines within the historical past of the seminal cryptocurrency.

Bear Market #1: Bitcoin Crash from $32 to $0.01 in 2011

Time wanted to retest the earlier peak: 20 months (June 2011-February 2013)

The worth of bitcoin broken its first main psychological mark of $1.00 in late April 2011 at beginning its first-ever rally to hit $32 on June 8, 2011. However the pleasure did not final lengthy, as Bitcoin then dropped in worth at lows at simply $0.01 over the course of some days.

The sharp selloff was broadly attributed to safety points on the now-defunct Mt. Gox, a Japanese crypto trade that traded nearly all of Bitcoin on the time. The trade saw 850,000 BTC stolen attributable to a safety flaw in its platform, elevating main issues in regards to the safety of Bitcoin saved on exchanges.

With BTC shedding round 99% of its worth in a matter of days, Bitcoin’s flash crash of June 2011 turned a giant a part of Bitcoin historical past. The occasion opened an extended stretch earlier than the value of BTC returned to the earlier excessive of $32 and climb to new heights solely in February 2013.

It’s tough to observe the value of Bitcoin earlier than 2013 in comparison with more moderen charts. Widespread value monitoring companies and websites like CoinGecko or CoinMarketCap don’t monitor Bitcoin costs till April 2013.

“Bitcoin was in its infancy earlier than 2013 and there weren’t many locations buying and selling Bitcoin again then,” CoinGecko’s COO stated. Bobby Ong says Cointelegraph. He added that CoinGecko didn’t obtain many information requests previous to 2013, so it’s low precedence for the platform.

Bear Market #2: Bitcoin Tanks from $1,000 to Below $200 in 2015

Time wanted to retest the earlier peak: 37 months (November 2013-January 2017)

Based on BTC value information collected by Cointelegraph, Bitcoin value achieved $100 in mid-April 2013, then continued surge to briefly hit $1,000 in November 2013.

Bitcoin entered an enormous bear market shortly after breaking above $1,000 for the primary time in historical past, with the value of BTC falling under $700 a month later. The worth drop got here as China’s central financial institution started to crack down on bitcoin in late 2013prohibiting native monetary establishments from processing BTC transactions.

The cryptocurrency continued to fall over the subsequent two years, reaching round $360 in April 2014 after which dropping even additional to a low of $170 in January 2015.

Bitcoin value chart from April 2013 to January 2017. Supply: CoinGecko

The lengthy cryptocurrency winter of 2014 was related to the hack of the Mt. Gox crypto trade, which stopped all bitcoin withdrawals in early February 2014. The platform then suspended all transactions and ultimately filed for chapter in Tokyo and the US.

Some main monetary authorities have additionally raised issues about Bitcoin, together with the US Commodity Futures Buying and selling Fee. claiming he had the power on the “manipulation of the bitcoin value” on the finish of 2014.

The final sentiment round Bitcoin was largely detrimental till August 2015 when the development began a long-term reversal. Amid a strongly bullish market, Bitcoin lastly returned to the $1,000 mark in January 2017. This was the longest all-time excessive value restoration in Bitcoin’s historical past.

Bear market #3: Bitcoin plunges under $3,200 after hitting $20,000 in December 2017

Time to retest earlier excessive: 36 months (December 2017 to December 2020)

After rallying to $1,000 in January 2017, Bitcoin continued to rally up to $20,000 by the top of that yr.

Nevertheless, like Bitcoin’s earlier all-time excessive of $1,000, the triumph of $20,000 was short-lived as Bitcoin then plummeted and misplaced over 60% of its worth in a matter of months.

2018 was shortly dubbed a “crypto winter” because the Bitcoin market continued to contract, with BTC bottoms around $3,200 in December 2018.

The crypto winter began with safety points on Coincheck, one other Japanese cryptocurrency trade. In January 2018, Coincheck suffered a big hack leading to a loss of approximately $530 million of the NEM cryptocurrency (XEM).

The bear market intensified additional as tech giants like Fb and Google prohibited advertisements for initial coin offerings and token sale bulletins on their platforms in March and June 2018respectively.

World crypto regulatory efforts additionally contributed to the bear market, with the U.S. Securities and Change Fee reject requests for BTC exchange-traded funds.

Bitcoin value chart from December 2017 to December 2020. Supply: CoinGecko

Bear Market #4: BTC drops from $63,000 to $29,000 in 2021

Time to retest earlier excessive: six months (April 2021 to October 2021)

Bearish sentiment dominated the crypto market till 2020, when Bitcoin not solely returned to $20,000 however entered an enormous bull run, topped at over $63,000 in April 2021.

Though 2021 will change into one of many largest years for Bitcoin, together with the cryptocurrency cross $1 trillion market capitalizationBitcoin additionally suffered a slight draw back.

Shortly after hitting new all-time highs in mid-April, Bitcoin pulled again barely, with its value ultimately falling to $29,000 inside three months.

The 2021 mini bear market got here amid a rising media narrative suggesting that Bitcoin mining has an environmental, social and company governance (ESG) downside.

World ESG-related FUD round Bitcoin had been additional exacerbated with Elon Musk’s electrical automotive firm Tesla abandons Bitcoin as a means of payment in Might, with the CEO citing ESG issues. Simply three months later, Musk admitted that round 50% of Bitcoin mining is powered by renewable energy.

The bear market didn’t final lengthy regardless of the beginning of a serious crackdown on local mining farms. The uptrend returned on the finish of July, with Bitcoin ultimately reaching its all-time excessive of $68,000 posted in November 2021.

Bear market #5: Bitcoin falls from $68,000 to under $20,000 in 2022

Time to retest earlier peak: TBD

Bitcoin failed to interrupt $70,000 and began falling in late 2021. The cryptocurrency has been sliding in a bear market since November final yr, recording considered one of its largest crashes in historical past in 2022.

In June, the cryptocurrency plunged under $20,000 for the primary time since 2020, fueling excessive concern available in the market.

The present bear market is basically attributed to the algorithmic stablecoin crisis – particularly the TerraUSD Basic (USTC) stablecoin – that are designed to assist a steady 1:1 parity with the US greenback by way of blockchain algorithms quite than equal money reserves.

USTC, as soon as a serious algorithmic stablecoin, lost its dollar peg in May. The USTC depegging sparked huge panic within the broader crypto markets, because the stablecoin managed to change into the third-largest stablecoin in existence earlier than collapsing.

Terra’s collapse triggered a domino impact on the remainder of the crypto market attributable to mass liquidations and uncertainty fueling a cryptocurrency lending disaster. A lot of international crypto lenders like Celsius had to suspend withdrawals attributable to their incapacity to take care of liquidity in brutal market situations.

Bitcoin has traditionally seen its value commerce under earlier highs for over three years. The earlier excessive of $68,000 was simply seven months in the past, and it stays to be seen if and when Bitcoin will return to new highs.