- The cryptocurrency market has lost around half of its value since hitting an all-time high above $830 billion earlier this month.
- Joe DiPasquale, the founder of crypto fund of funds BitBull Capital, tells Business Insider this is a market event the crypto world has seen play out over each of the past three years.
The cryptocurrency markets are shuddering in what some are calling a “cryptocurrency bloodbath,” but long-term bitcoin holders will tell you they’ve seen this before.
In fact, this is the third year in a row that bitcoin — and the overall market for digital coins — has plunged early in the new year, according to a blog post by Joe DiPasquale, the chief executive officer of crypto fund of funds BitBull Capital.
DiPasquale calls it “the perennial dip.”
“It’s worth pointing out that this is nothing new for experienced crypto investors,” DiPasquale wrote. “In fact, it’s become something of an annual tradition.”
In 2016, the cryptocurrency market shed 27% off of a peak above $7.5 billion, DiPasquale illustrated in a chart courtesy of CoinMarketCap.
“It would be 43 grueling days of uncertainty before investors who bought at January’s peak would see green again,” DiPasquale wrote.
Here’s how the market fared after the 2016 crash:
In 2017, it took even longer for the crypto markets to recover from a 35% correction that brought the total market capitalization down to $14.38 billion from a high of $22 billion. Those losses were underpinned by anxieties about a crackdown in China. Bitcoin got demolished after China announced it had begun investigating bitcoin exchanges in Beijing and Shanghai on suspicion of market manipulation, money laundering, unauthorized financing, and other issues.
“Again, there was a substantial lull as the markets climbed back to their former glory; a trek that took a total of 50 days to complete, and concluded in mid-February of 2017,” according to DiPasquale.
Eventually, the market climbed to new heights in April after Japan declared bitcoin a legal currency and gave a number of cryptocurrency exchanges licenses to operate in the country.
Here’s how the 2017 crash played out:
On January 7, 2018 the cryptocurrency market reached an all-time high value above $835 billion. At last check, the crypto market is more than 45% lower at $452 billion.
Again, investors are concerned about regulators clamping down. The current slump comes amid reports that Russia could be about to impose stricter regulations on the sector. The Russian news service TASS reported last week that Russian President Vladimir Putin said “legislative regulation will be definitely required in future” for cryptocurrencies.
In Asia, regulators also appear to be clamping down. South Korean regulators were reportedly flirting with a ban on cryptocurrency trading.
Mati Greenspan, an analyst with the trading platform eToro, told Business Insider’s Oscar Williams-Grut on Tuesday that volumes from Japan and South Korea had been tailing off in recent days.
“Now, 9 days later, we are (hopefully) nearing the bottom of the valley, as we exceed 55% losses,” he wrote.
Read more at:
http://www.businessinsider.com/cryptocurrency-bitcoin-markets-tumbled-early-in-the-year-but-this-has-happened-before-2018-1
