2022 has unquestionably been "annus horribilis" for Bitcoin and its siblings. The crypto market and business, however, have been there many times before.
In the brief 12-year existence of Bitcoin, there have been four significant bull/bear cycles. Each time, the media and doomsayers write off the asset and pronounce the sector to be dead.
Additionally, according to 99Bitcoins' obituary website, Bitcoin "died" 467 times! The first known "death" of a Bitcoin occurred in December 2010; the most recent occurred on November 30, 2022. The most "deaths" occurred in 2017, when the asset was written off by the media at least 124 times.
Grayscale, the largest institutional crypto asset manager in the world, has compiled eleven instances where Bitcoin recovered from disastrous falls.
In 2011, when the asset fell by 99%, BTC values experienced their first significant drop. Prices on the troubled exchange fell from $32 to $0.01 as a result of the Mt. Gox hack and crash.
Late in 2013, after the Chinese government forbade financial institutions from accepting Bitcoin as payment, the value of the digital currency fell by 80% in a single day.
BTC values fell by around 60% in February 2014 as a result of yet another Mt. Gox breach. At the time, the exchange handled up to 80% of all Bitcoin trades.
Ethereum and Bitcoin values were both severely impacted at the time of the DAO breach in mid-2015. Ethereum underwent a hard fork. The new blockchain gave rise to the Ethereum (ETH) that is used today, while the old chain became Ethereum Classic (ETC). In addition, a hack on Bitfinex in 2016 caused the price of bitcoin to collapse.
By the end of 2018, BTC prices had fallen by 84% due to a severe crackdown on initial coin offers (ICOs). After reaching a peak of $20,000 at the end of 2017, prices dropped as low as $3,200.
BTC values were severely impacted in March 2020 when markets crashed and governments throughout the world implemented lockdown policies. In that "black swan" event, BTC dropped to about $5,000, resulting in a loss of more than 50%.
This year, May and November, saw two capitulations on the bitcoin markets. Both of these happened after the important platforms Terra/Luna and FTX fell. The first went from $40,000 to $20,000 over two slides in May and June, a 50% reduction in BTC values. The FTX collapse in the second caused a 25% crash.
There is no reason why Bitcoin won't recover from this tragedy in the same way that it has after every other one so far.
BTC is currently trading 134% higher than it was three years ago, which helps put things in perspective.
Price of Bitcoin in 2023
Prices for BTC have dropped by 63.5% since the year 2022 began. On November 22, they reached a bear cycle low of $15,700, but since then, they have recovered a little calmness to trade in a range.
Analysts predict that bull market indications won't appear until mid-2023. A modest upswing to reclaim the $20,000 level is possible in the interim, but the consolidation is likely to persist until then.
If history repeats itself, the BTC halving event in May 2024 will probably serve as the main impetus for a bull market. Prior to the halving, there was a minor recovery until the bulls rallied following the reduction in block rewards.