(ETX Daily Up) – Bitcoin loses 65% of its value from its all-time high in November 2021, a cryptocurrency market that dips below $ 1 trillion, planned layoffs at major cryptocurrency operators. In recent weeks, all indicators in the sector have been red. To the point of talking about a “crypto winter”.
Has the cryptocurrency market come to an end or is it just a bad patch? The sector is in sharp decline, after an incredible rise in 2021. Specialists do not hesitate to use the term “crypto winter”. In English, the expression really takes on its full meaning. “Crypto Winter” is a nod to the “Game of Thrones” series and House Stark’s motto “Winter is coming” (“Winter is coming”). A kind of warning that a lasting conflict could arise at any moment. This is exactly what is happening to cryptocurrencies.
The concept of crypto winter first appeared in late 2018, right in the middle of the “crypto winter” period. From January 2018 to December 2020, the price of cryptocurrencies dropped dramatically and remained at a more or less stable level for many months. A “winter” then lasted almost two years, before prices started to rise again. Indeed, the original term “crypto winter” qualifies this long period of price cooling, which can last for several months.
After a recovery in 2021, the prices of all cryptocurrencies have not stopped falling since last January. Bitcoin, which is one of the industry’s leading health indicators, has hit an 18-month low. It hit its record high in November 2021, surpassing $ 68,000 for a while. It has now dropped below $ 25,000.
Bitcoin is no exception. All cryptocurrencies suffered a comparable decline at the same time. The global cryptocurrency market has dropped to $ 1 trillion, from just seven months ago it was valued at $ 3 trillion, according to the Coingecko website, which lists more than 13,000 different cryptocurrencies.
The consequences are therefore direct in the investors’ portfolios, but also in the main market players, in great financial difficulty, such as Coinbase, one of the largest cryptocurrency exchange platforms in the world, which is extending its frozen hires and canceling offers of work. Cryptocurrency companies around the world in general are downsizing to survive this “winter”.
But it is characteristic of cryptocurrencies to be volatile and therefore to experience such “winters”, more or less long, more or less “frozen”. Despite the red indicators today, prices may rebound faster than expected. The outcome of this “winter” will partly depend on the evolution of the war in Ukraine, as Russia is a major player in cryptocurrencies, particularly in terms of mining.