Industry Experts Remain Unfazed by 70% Crypto Market Crash

Over the past seven days, crypto markets have plunged a whopping 24%, shedding $320 billion from total market capitalization. That figure, which encompasses all cryptocurrencies, fell to an 18-month low beneath $900 billion this week, marking a 70% drawdown since November.

The massive sell-off has paused a little today as markets recaptured that $900 billion level, but all digital asset prices are still bleeding out on a macro scale. This is nothing new, however, since it happened in 2015 and then again in 2018, resulting in 80% collapses in prices and a long-drawn-out period of consolidation known as crypto winter.

Leaders in the industry, though, have shrugged off the bear market, according to a CNN report on June 15, claiming it is par for the course.

Been There Before

According to Blockworks co-founder Jason Yanowitz, an 85-90% drawdown for crypto markets is normal. Bitcoin fell 84% in 2018 from its then all-time high of $20,000 to bottom out at $3,200 in mid-December of the same year following a massive capitulation event in late November.

Ethereum’s collapse was even more significant, dumping 94% from $1,440 in January 2018 to around $85 in December of the same year. By November 2021, it had surged to an all-time high of $4,878; however, it is currently 75% below that level.

CEO of Xchange Monster, Felix Honigwachs, told CNN that it was all about the timing, adding that anyone that bought and held below the last cycle peak would still be up today. Yanowitz continued:

“I really disagree with the folks who say there’s no way to recover from something like this. I think people look at crypto and think it’s weird or that it’s not real. If you don’t think crypto is real you probably think it’s overvalued.”

Ethereum advocate and crypto investor Ryan Sean Adams pointed out the differences between the last cycle and this.

The macro-economic fallout from an unprecedented global pandemic and a war all in the same year has battered all markets, not just crypto.

Crypto Market Bottom In Yet?

With miners moving large amounts of Bitcoin to exchanges this week, the final capitulation could be imminent, marking the bottom of this market cycle.

Bitcoin miners have been hit with a triple whammy of rising energy prices, falling asset prices, and high hash rates and difficulty. In order to survive and make it to the next market cycle, they’ll need to liquidate, which could cause real fear and panic, though it can’t go much lower.