The Crypto Winter Phenomenon and Its Impact on the Market
Rancakmedia.com – In the crypto realm, many key phrases are commonly referred to, one of which is Crypto Winter. Then, what is meant by crypto winter?
Overview of Crypto Winter
Crypto Winter is a scenario that occurs when the value of a crypto asset declines far below the values of a typical bullish trend. Last June, the five most popular crypto assets in the world nearly crashed within a week. As a result, many traders are anticipating there will be another winter for crypto assets, which is being dubbed Crypto Winter.
At that time, Bitcoin for the week fell 7.5 percent. Ethereum also fell in value by 14.5 percent. Later, Binance Coin fell 14.6 and Tether remained almost constant in value. Finally, Cardano (ADA), which is currently third on the CoinMarketCap site, also fell by 6.4 percent.
However, the fears of traders or investors were unfounded as Bitcoin did not fall to the level of 20 thousand US dollars as indicated by Peter Hank, analyst at DailyFX.
Winter for crypto assets is possible if their value reaches the threshold of 20 thousand dollars. Meanwhile, according to the Bitcoin price chart on the CoinMarketCap website, on June 30, the value of Bitcoin was at 35 thousand US dollars.
Crypto Prediction Winter 2021
Co-founder and former CEO of crypto exchange BTCC, Bobby Lee told CNBC Asia that Bitcoin tends to function in four-year cycles with big spikes in 2013, 2017, and the biggest spikes predicted this year.
Not only that, some crypto experts and investors also argue that Bitcoin has a four-year price cycle, in which four separate phases occur each year. Some of these phases are exponential, correction, recovery and price continuation phases.
Lee predicts that Bitcoin will surpass $300,000 by the end of 2021. After a possible 10x increase in Bitcoin by the end of the year, it is conceivable that the value will fall again, assuming it follows the moves in the previous two bull phases.
How long does Crypto Winter last?
According to CNBC, the Winter phase may last from two to three years. Even so, some experts such as Benjamin Cowen are still debating the veracity of Bitcoin's four-year price trend.
Cowen argues that the Bitcoin price cycle, will not always happen every four years. This is due to the regularly varying supply and demand quantity system of Bitcoin.
Crypto Winter that happened last time
The most recent Crypto Winter occurred in 2018. At that time, the price of Bitcoin fell by more than 70 percent.
Not only that, Crypto Winter in 2018 also caused the value of Bitcoin to stop and even tend to fall until April 2019.