The Comparisons Between the 2018 Crypto Bear Market and Now: Are They Useful?
Cryptocurrency is currently heading into another bear market. Click here to find out how noting comparisons can be useful.
The crypto bear market which began back in 2018 and lasted until 2020 can seem like a distant memory for an investor. While at the time it may have seemed like the market may not recover, the bull market which followed saw a number of coins flourishing.
There were, of course, some hype-train investors who had jumped at the first sign of trouble, but the volatile nature of cryptocurrency is simply a part of its nature. The river can ebb and flow, but it always heads in the same direction, and the ocean of crypto’s future is said to be deep with opportunities.
That’s not to say things don’t get a bit tricky along the way. Although many investors saw out the icy plains of the first crypto winter in time for the beds to warm and the water to flow, over the last few months the cryptocurrency market has run into some more difficulties. In November 2021, the price of Bitcoin hit an unprecedented high of nearly $69,000. Today, its price sits around $17,000 and, if predictions are to be believed, we are about to head into another winter which could see its price fall even further.
So How Do You Prepare For Another Cold Patch?
In Wall Street terms, the dipping of equity markets is referred to as a bear market, where the valuation of assets hibernates until the horizon looks brighter and the markets begin to flourish again. In terms of the cryptocurrency market, this is a good chance for investors to separate the wheat of their portfolio from the chaff, ensuring that they can take advantage of the bull market when it rears its head.
While many inexperienced crypto traders will make unsteady, foolish decisions, traders with a clear, concise plan can lay out their portfolio and minimise risks by being clinical with investments and sharpening their strategies.
But How Do You Know How To Minimise Risks?
The positive aspect of going into a second crypto winter is that there has been a first one. In this way, you can either look back and learn from how you handled the initial bear market or, if you have recently become involved in the crypto community, you can search for comparisons and draw out a plan on how you can utilise them.
Looking at Bitcoin specifically, in 2017 it reached an all-time high of $19,000. When the bear market kicked in, it collapsed to a low of $3,200, which is equivalent to a drawdown of 83%. In today’s bear market, Bitcoin has so far fallen over 70% from its high of $69,000 in November 2021. If it was to match the drawdown in 2017, then you can foresee it falling as low as $11,400 by the time the bear market is over. Similarly, you could predict that another six months of decline is potentially on the table, seeing as Bitcoin’s last bear market lasted a total of eighteen months.
What About Ethereum Comparisons?
For Ethereum, too, the comparisons between the last bear market and today’s winter can similarly shed light on how you should prepare your assets. Ethereum fared worse than Bitcoin between 2018 and 2020, with an all-time high of $1,396 collapsing to a low of $86 over the course of one year, which is equivalent to a 93.8% decline. This year, ETH has fallen from a high of $4,812 to $896, which is a drop of about 81%. If it was to match the drawdown in the last bear market, it could fall as low as $292, which would be a further 67% drop.
It is worth noting that, although this may seem like a bad situation, Ethereum’s future is still set to push the coin considerably higher than it has ever been before. This is due to the merge which is still on track to take place over the next two years. The merge involves a move to a proof-of-stake (POS) consensus mechanism, which has led experts to believe Ethereum will emerge as the leading cryptocurrency over Bitcoin. In this way, it is important to consider the factors which can alter the price of Ethereum after the crypto winter. If you are currently undergoing a hodling strategy with ETH, then it is still a safe bet to hold on to the coin and trust in a positive bull market when the merge has been completed.
How Are These Comparisons Useful?
These comparisons are useful because they give you a base point for the research you will have to undergo to survive the bear market. The similarities and differences between this winter and the last one can not only allow you to draw out a timeline but also predict how the coins are going to be affected, where they could fall, how far they could fall, and how high they may rise when the bull market comes around.
This will help you draw out strategies, whether that is DCA (dollar-cost averaging), shorting or the diversification of your portfolio. Predicting how a bear market will play out isn’t easy, and obviously, no bear market will be exactly the same (especially given external factors which have led to this particular crypto winter), but noting the comparisons between the two can give you an idea on the right moves to make and how you can benefit when the market eventually recovers.
It is worth noting, however, that if you are planning to short sell your BTC or ETH then you should be assured of your investment capabilities. Shorting is ordinarily reserved for the most experienced of traders, because of its inherent risks and the possibility of liquidation. If you are inexperienced, then it is best to avoid this, as you do not want to make an already difficult situation even more ugly.
For any market, however, research is critical to survival. No one can tell you how to use the facts and figures, but it is up to you to acknowledge them and work out the best strategies to move forward. It’s your own assets at stake, so you should ensure to take everything into account and keep your eyes set on a profitable future.
Regulatory tightening and EU MICA - risk or opportunity
In this article, we’ll discuss the upcoming Markets in Crypto Assets (MiCA) bill proposed by the EU Parliament. ...
The 5 Main Types of Crypto Attacks
In this article, we’ll examine the five main types of attacks that target cryptocurrency users.
Crypto Trends in October 2022
It’s October! What's trending in crypto this month?
Crypto Trends in September 2022
It’s September! What's trending in crypto this month?
Bitcoin Showing Signs of Resurgence After Catastrophic Dip: What's Contributed?
The Crypto Winter looms even as Bitcoin’s price shows signs of stabilising and resurging. Read on to discover ...
Tesla Sells Bitcoin Holdings: Will This See the Beginning of a Trend for Other Businesses Who Hold Crypto?
Tesla has sold off 75% of its Bitcoin holdings. Click here to find out why and whether other businesses will be ...
All About Crypto Seasonality
The total market capitalization of the top 100 cryptocurrencies has increased over the past seven years from ...
Getting to Grips with Arbitrage
The world of trading has many different tricks and tools refined over the years by strategists and financiers, ...
The Crypto Winter: Are There Any Advantages?
It seems that another crypto winter is among us, but what does it mean and are there any advantages? Click here ...
The Blossoming Intersection of Fashion and Crypto: What Does the Future Hold?
Over the last few years, fashion and crypto have been entwined together. Click here to find out what this means ...
Could Post-Merge Ethereum Have a Centralization Problem?
Ethereum recently completed its merge into Ethereum 2.0. Click here to find out if this will bring about a ...
Instagram to Add Support for NFTs
Instagram to launch NFT functionality on its platform in 100 countries worldwide
Can Ethereum’s Ecosystem Keep Its Future Bright Amidst This Crypto Winter?
Ethereum has steadily been building an ecosystem unlike any other. Click here to find out why its future remains ...
Buterin Criticises Bitcoin’s Stock-to-Flow Price Prediction Model – But What Is It?
The stock-to-flow prediction model has caused a mixed reaction amongst the crypto community. Click here to find ...
AVAX, the Ethereum Killer: What You Need to Know
AVAX, which is a token run on the Avalanche blockchain, is said to be the Ethereum killer. Click here to find out ...
A ‘Digital Library of Italian Culture’ in Puglia: Is It Expanding NFT Use to New Areas?
The University Aldo Moro is currently using NFTs as a way to reignite the culture of Puglia. Click here to find ...
Crypto’s Position in the Italian Economy: Will It Only Grow and What Would Regulation Do?
Crypto is continuing to grow in the Italian economy. Click here to find out how and what regulation might mean ...
Will the EU Adopt a Digital Currency?
Cryptocurrency is growing across the world, with more and more countries starting to embrace it. Click here to ...
Ethereum’s Proof of Stake System: Do Other Coins Use It?
Ethereum is currently switching to the proof of stake system. Click here to find out what this means and whether ...
We are delisting Swipe (SXP)
Due to a change in the blockchain used by Swipe, SXP will no longer be supported.
Scheduled Maintenance on 05/06/2023
We will conduct scheduled maintenance from 06:30 to 07:00 (UTC+2) on 05/06/2023.
We are listing Ocean Protocol (OCEAN)
We will soon be listing OCEAN, the native token of the Ocean Protocol project
Our Slovakian license is approved!
The license is another achievement along our path to becoming the most well-regulated exchange in Europe
"Lights, Camera, Trade!" Trading Competition
Get ready for the zondacrypto rebranding trading competition!
Zonda is now zondacrypto
Your favourite crypto exchange is getting a new look and added features!
How is Zonda working during long May weekend?
Please note that during Long May weekend, our customer support team will be available as usual. However, during ...
Important Notice: We are delisting LUNC
To provide the safest trading experience for our customers, we regularly review each token on the exchange to ...
We’ve partnered with crypto tax experts Cryptiony!
Get 20% off when you sign up with our promo code
We are listing Fetch.ai (FET)
We are listing $FET, the token of the Fetch.ai project, on Monday 24 April 2023.
4. 08 Phishing: types and examples
Phishing is a type of fraud that involves impersonating another person or institution in order to extract data ...
4. 07 Investment scams. What to look out for?
Investment fraud is one of the most common recent threats that is oriented towards people who use the services ...
4. 06 Travel Rule
Travel rule is a rule well known from the traditional banking sector, which states that all funds sent from one ...
4.05 Crypto taxation in Poland
Every year in Poland, more and more people are investing in cryptocurrencies. This involves, among other things, ...
4.04 Illegal Activities in Crypto
In this lesson, we explore recent statistics and discover insights about criminal activities related to ...
4.03 DLT Pilot Regime
The Regulation of the European Parliament and of the Council on a pilot regime for market infrastructures based ...
4.02 Digital Operational Resilience Act (DORA)
In this lesson you will learn more about the Digital Operational Resilience Act (DORA), which as a part of ...
4.01 Markets in Crypto Assets (MiCA)
In this lesson you will learn more about MiCA, which aims to be the first comprehensive law regulating ...
3.03 The Dow theory: principles and statements
This lesson helps you understand the principles and statements of Dow’s theory.
3.05 Candlestick charts and patterns
This lesson focuses on understanding candlestick charts and patterns.
Invezz / Interview: Volatility, liquidity and what happens next for crypto – zondacrypto exchange
Anyone who has ventured into the cryptocurrency world will agree with one thing: the volatility is unmatched. Be it plummeting or soaring prices, crypto markets are notorious for the pace at which they move. In this interview, Stanislav Havryliuk, our COO, assesses the current situation on the crypto market.
US regulators are cracking down on stablecoins!
Blockworks spoke to our COO Stanislaw Havryliuk about the recent SEC action against @PaxosGlobal and stablecoin #BUSD
Should we expect to see similar action against #USDT and #USDC? Which #stablecoin is the safest option?
Meet the person that is creating ripples of growth in the crypto space
Our CEO Przemysław Kral is making headlines again!
In this feature from FoxInterviewer, he discusses the skills needed to succeed in the emerging digital assets industry, the importance of KYC and AML procedures, and the tools he is building at Zonda.
Business Insider recently had a chat with our CEO
Zonda’s CEO Przemysław Kral recent spoke to Business Insider about the importance of consumer safety and compliance in the crypto sector.
Read the full article, along with additional commentary from our COO Stanislav Havryliuk
How will the US banking crisis affect crypto? Our CEO spoke to Benzinga
The collapse of Silvergate has sent shockwaves through the crypto industry. Where will US crypto businesses now go for banking services?
Zonda CEO Przemysław Kral recently spoke to @Benzinga about this issue and the problems it could cause.
Zonda is now zondacrypto!
As the exchange continues to evolve and grow, we're thrilled to announce that we're rebranding and changing our name to better reflect our vision and values. We're still the same team you know and trust, but with a fresh new name that captures our spirit of innovation and customer-centric approach.
Some things may look a bit different but don’t worry - all operations remain the same and your login details work as usual.
Stay tuned for more updates and exciting changes as we embark on this new chapter together. Thank you for your continued support and loyalty!