Cryptocurrencies have been around for a long time, and their prices have changed a lot. Many times in the past, bears have shown that they are in charge of the market. In the business world, a “bear market” is when prices are about 30% lower than their all-time highs. Since the beginning of the year, most cryptocurrencies have lost more than that. The term “crypto winter” is well-known because of the hit HBO show “Game of Thrones.” The date is a sign that things are about to get worse in the cryptocurrency industry. If you also want to invest or trade in cryptos then check this Official Website.
When does the winter of cryptocurrencies start?
Long periods of crypto winter are usually caused by a combination of many different things. At the beginning of 2022, there were a number of important macroeconomic issues, like the Federal Reserve raising interest rates, that have a big effect on the cryptocurrency market.
Because of what happened with Celsius, the price dropped to US$18,000 in June, which is the lowest it has been since December 2020. The recent events that have caused the price of Bitcoin (BTC) to go down are seen by the market as a sign that the crypto winter is coming.
When there is a bear market, investors often show a lot of worries, which can be seen in how the market feels. On the other hand, some people choose to ignore the risks of a crypto winter and instead focus on the good things it could bring.
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Alex Tapscott, who runs Ninepoint Digital Asset Group, says that when the market is down is the best time to focus on building. During a talk with the Cointelegraph, he said this. Tapscott emphasized how important it is to look beyond the prices on the market and see what is being built. Tapscott explained more when he said:
“The winter months are always the best time in the cryptocurrency industry to focus on these basic ideas, do the work that needs to be done, and start building for the future.” The last bear market led to the NFT revolution, decentralized finance, stablecoins, and play-to-earn games.
The CEO thinks that Web3 will be able to reach its full potential once the bear market is over. Tapscott used decentralized finance (DeFi) as an example, noting that it has the potential to go much further and keep on its path as the financial system of the new internet. What he said was:
Tapscott said that the value of crypto-assets has dropped by about $2 trillion during the current bear market. Because of this, a lot of big news sites said Bitcoin was dead. Crypto-assets are things that are bought and sold online instead of at traditional markets (BTC). On the other hand, the veteran of the cryptocurrency market told investors to stay calm and look for opportunities, since bear markets often lead to new ideas and businesses. What he said was:
“The most successful people in the crypto space are the ones who can keep their cool and keep moving forward.” I don’t know when this bear market will end, but I’m sure it will, just like all the others.
In the short term, the CEO also talked about how scary it is for investors when the prices of cryptocurrencies keep going down. Tapscott did say, however, that investors seem to have calmed down, which could mean that the worst is over.
Why would you want to be here at this time?
During a bull market, it might look like every random project and cryptocurrency is on a rocket ship to the moon. Most of the time, a bear market is the best time to find mistakes in pricing and fix them. Crypto winters tend to kill off projects that won’t work while pushing the most innovative companies to build and test their products. After winter’s “regeneration” phase, cryptos that had made it through the season would be able to move on.
Is a cryptocurrency winter the same as a bear market?
A “bear market” is a market that is doing badly. Stocks, cryptocurrencies, or even equities could be traded on this market. But the term “crypto winter” is often used to describe a time when the prices of cryptocurrencies are much lower than they have been in the past. During this time, most cryptocurrencies are changed in some way. During a crypto winter, investors should be ready for the market as a whole to go down.
