A Brief History of Bitcoin Crash and Bear Markets: 2009-2022

A Brief History of Bitcoin Crash and Bear Markets: 2009-2022

It had one of the most brutal crashes in Bitcoin (BTC) in 2022, and the price of BTC fell below $ 20,000 in June after a high of $ 68,000 in 2021.

June 2022 became the worst month for bitcoin since September 2011, with monthly losses reaching 40%. The cryptocurrency also posted its biggest quarterly losses in 11 years.

However, the current market sales do not mean that bitcoin crashes and bear markets are exclusive until 2022. In fact, bitcoin has survived its share of cryptocurrency winters since the first bitcoin blockchain was achieved, or genesis blockin January 2009.

Zooming in on the bitcoin price chart, Cointelegraph achieved five of the most significant price reductions in the history of the founding cryptocurrency.

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

Time required to reach the previous peak again: 20 months (June 2011-February 2013).

The price of bitcoin crossed its first major psychological threshold of $ 1.00 at the end of April 2011 for to initiate its first ever rally and hitting $ 32 on June 8, 2011. But the joy did not last long, as the value of bitcoin then dropped to a low of $ 0.01 within a few days.

This precipitation drop was widely attributed to security issues at the Mt. Unusual Gox, a Japanese crypto exchange that traded most bitcoins at the time. The exchange saw 850,000 BTC theft due to a security breach in its platform, which raised serious concerns about the security of bitcoins stored on the exchanges.

With BTC losing about 99% of its value in just a few days, the June 2011 flash crash made bitcoin history. This event opened an extension long before the BTC price returned to its previous high of $ 32 and tóg to new heights than in February 2013.

Haha nice #bitcoin crash at 0.01 USD / BTC. – Who knows? ₿⚡️ (@who_knows) June 19, 2011.

It is difficult to follow the price of bitcoin before 2013 compared to later charts. Popular price tracking services and sites, such as CoinGecko or CoinMarketCap, do not track bitcoin prices until April 2013.

“Bitcoin was in its infancy before 2013 and there weren’t many places to trade bitcoin at that time,” Bobby Ong, COO of CoinGecko, told Cointelegraph. He also said that CoinGecko did not receive many data requests before 2013, making it a low priority topic for the platform.

Bear Market # 2: Bitcoin Falls From $ 1,000 to Under $ 200 in 2015

Time needed to reach the previous peak again: 37 months (November 2013-January 2017)

According to BTC price data collected by Cointelegraph, the price of bitcoin achieved $ 100 in mid-April 2013, then continued to rise to $ 1,000 in November 2013.

Bitcoin entered a huge bear market soon after breaking above $ 1,000 for the first time in history, with the price of BTC falling below $ 700 a month later. The price crash came when the Chinese central bank began tapping down on bitcoin in late 2013, banning local financial institutions from processing BTC transactions.

The cryptocurrency continued to deteriorate over the next two years, falling at around $ 360 in April 2014, before falling even further to reach the low of $ 170 in January 2015.

Bitcoin price chart April 2013-January 2017. Source: CoinGecko

The long winter of cryptocurrency 2014 involved the hack of the cryptocurrency exchange Mt. Gox, which stopped all bitcoin withdrawals in early February 2014. The platform then suspended all transactions and finally filed bankruptcy in Tokyo and the United States.

Concerns about bitcoin have also been raised by several major financial authorities, and the U.S. Commodity Futures Trading Commission claimed it had the power to “manipulate bitcoin prices” in late 2014.

The general outlook for bitcoin remained largely negative until August 2015 when the trend of a long-term reversal began. Amid a strong bull market, bitcoin returned to the $ 1,000 mark in January 2017. This was the longest recovery stretch from the highest level ever in bitcoin history.

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

Time to reach another climax: 36 months (December 2017-December 2020).

After rallying to $ 1,000 in January 2017, bitcoin continued to rise to $ 20,000 by the end of that year.

However, similar to bitcoin’s previous full-time high of $ 1,000, the $ 20,000 win was short-lived, as bitcoin then fell and lost more than 60% of its value within months.

2018 was quickly called the “crypto winter” as the bitcoin market continued to contract, with BTC reaching around $ 3,200 in December 2018.

Cryptocurrency winter began with security issues on Coincheck, another Japanese cryptocurrency exchange. In January 2018, Coincheck suffered a massive hack that resulted in the loss of approximately $ 530 million from the cryptocurrency NEM (XEM).

The bear market was further exacerbated when technology giants like Facebook and Google banned ads for ICOs (Initial Coin Offers) and token sales on their platforms in March and June 2018, respectively.

Global cryptocurrency regulation efforts also helped the bear market, with the U.S. Securities and Exchange Commission rejecting applications for a BTC exchange trading fund.

Bitcoin price chart December 2017-December 2020. Source: CoinGecko

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

Time needed to reach the previous peak again: six months (April 2021-October 2021).

Bearish sentiment was at the forefront of the cryptocurrency market until 2020, when Bitcoin not only returned $ 20,000, but entered a huge bull run, peaking over $ 63,000 in April 2021.

While 2021 is now one of the biggest years for bitcoin, with the cryptocurrency surpassing a market capitalization of $ 1 trillion, bitcoin also has a slight disadvantage.

Shortly after breaking all-new highs in mid-April, bitcoin declined slightly, and its price finally dropped to as low as $ 29,000 in three months.

The 2021 miniature market took place in a media context that would suggest that bitcoin mining posed a problem of environmental, social and corporate governance (ESG).

ESG’s global confusion over bitcoin is exacerbated by the fact that Tesla, Elon Musk’s electric car company, abandoned bitcoin as a form of payment in May, with the CEO citing ESG’s concerns. Just three months later, Musk admitted that about 50% of Bitcoin mining is powered by renewable energy.

Anxiety Series (FUD) – Lina Seiche (@LinaSeiche) June 20, 2021

The bear market did not last long, although China began to break down local mining companies. The upgrade came back at the end of July, and bitcoin finally reached an all-time high of $ 68,000, still intact, in November 2021.

Bear Market # 5: Bitcoin drops from $ 68,000 to under $ 20,000 in 2022

Time to retry previous peak: TBD

Bitcoin failed to break above $ 70,000 and began to fall in late 2021. The cryptocurrency has been slipping into the bear market since November last year, recording one of its biggest full – time crashes in 2022.

In June, the cryptocurrency fell below $ 20,000 for the first time since 2020, fueling strong market fears.

The ongoing bear market has been largely attributed to the crisis in algorithmic stablecoins, most notably the stablecoin TerraUSD Classic (USTC), designed to support a 1: 1 stablecoin peg to the US dollar through blockchain algorithms rather than equivalent cash reserves .

USTC, once a large algorithmic stable, lost its pin for the dollar in May. USTC depreciation triggered massive panic in broader cryptocurrency markets, as stablecoin became the third largest stablecoin before it fell.

The collapse of Terra had a domino effect on the rest of the cryptocurrency market as massive liquidations and uncertainty triggered the cryptocurrency lending crisis. Some global cryptocurrency lenders, such as Celsius, have had to suspend withdrawals due to their inability to maintain liquidity in brutal market conditions.

Historically, bitcoin has seen its price trade below previous highs for over three years. The previous high of $ 68,000 was only seven months ago, and it remains to be seen whether and when bitcoin will return to new highs.

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