Throughout the last year, the excitement has been sucked out of the cryptocurrency market. If you were paying close attention to crypto communities on places such as Twitter (X), or YouTube, the mood is dire, and enthusiasm has long ago transformed into fear. After a summer of insolvencies, FTX’s fraud, and now an entire year of prices moving sideways. People are declaring that this is the worst bear market ever. And perhaps crypto will never be able to recover from this; that the death blow to Bitcoin and crypto has finally been dealt.
However, one of humankind's biggest weaknesses is that we often are too emotional and get caught up in the moment. We will feel the highest of highs while Bitcoin is going parabolic. Declaring that this time will be different, its price will soar to unprecedented heights, and there won’t be another bear market. This time will be different.
And we also feel the lowest of lows. When things are going wrong, this causes us to feel that this is the worst it has ever been. While Bitcoin’s price is dropping for months on end, we forget about the traits that make it great, and why we even valued it in the first place. We also forget how much potential it has, and the volatility its price has when it finally decides to move.
While many people will tell you how horrible this bear market is, and how it’s possibly the worst one ever. This is just another case of people being too emotional, and not being able to zoom out.
The hard truth is that this is the best bear market that Bitcoin has ever seen.
For example, let’s take a look back at the previous bear market in 2018. We had just had a price rise up to $20k, and hype swept around the world. For many people, this was the first time that they had ever heard of Bitcoin. And then there was a blow-off-the-top moment. Just as it was on the verge of becoming a “respected” asset, it collapsed. People lost money, but more importantly; companies, organizations, governments, and nearly everyone else completely distanced themselves from this market.
People were saying that the “crypto bubble” had finally burst and was very similar to the DOT.com bubble that burst in the early 2000s. While it is harder to imagine today, the cryptocurrency market was much less established during that cycle and had much less history. After the blow-off-the-top, there was much less of a guarantee that the market would ever recover. Those that stayed in the market were considered delusional, or simply crazy. To put it simply, the world moved on from crypto at that point.
However, this crypto bear market is different.
To see that the crypto bear market is different in 2023, all you need to do is look at the BlackRock spot Bitcoin ETF application announcement. There is no way in Hell, that the largest asset manager would have done this sort of thing during the last bear cycle. They didn’t want to touch Bitcoin or crypto with a nine-foot pole.
To further my point. Let’s look at the recent announcement of PayPal creating their own stablecoin. Once again, during the last cycle, PayPal wanted nothing to do with this industry, and would even often criticize it. The world and its biggest companies are shifting toward crypto.
During the last crypto bear market, there wasn’t a country that had made Bitcoin legal tender and is using it to run their country on a daily basis. But here we are in 2023, and El Salvador is still using Bitcoin. You could even argue that it is beginning to ramp up with their volcano Bitcoin bonds, and with them building Bitcoin City.
When you turn on the financial news, it seems that you can’t go a day without Bitcoin and the cryptocurrency industry being discussed. Each time there is an influential guest or interview, you can count on them being asked about Bitcoin.
Yes, it is true that the price of Bitcoin and other cryptocurrencies are much lower than we had expected and hoped.
With that said, there is no denying that the Bitcoin and crypto market have progressed significantly throughout the last 5 years. In mindshare, and use-case. No, this crypto bear market isn’t like other bear markets. It is the best one we have ever seen. The future looks bright.
How about you? Do you think this is the best crypto bear market we have seen
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As always, thank you for reading!