Bitcoin and the rest of the crypto sector have already gone through multiple boom and bust cycles. And currently, market conditions suggest that we are in such a situation.
Since the beginning of 2022, prices of coins has been falling following the break out of the war between Russia and Ukraine on 24th February, Terra crashing, Celsius filing bankruptcy and the recent one FTX, one of the biggest crypto exchange filing for bankruptcy with its native token, FTT shedding off billions of dollars of market capitalization. However, Bitcoin held steady over its most recent $15,470 support for a 2nd consecutive week. Given that bitcoin is holding this firm, does the past give us any clues as to what the end of 2022 means and when the current crypto winter might be over? Before we go into that, let’s discuss what crypto winter means. What is Crypto Winter? Unlike terms such as “market correction” or “bear market,” crypto winter doesn’t have a precise definition. But, according to Forbes.com, the phrase “crypto winter” likely drew its origin from the hit television series Game of Thrones. In the show, the motto of the House of Stark was “Winter Is Coming.” It was considered to be a warning that lasting conflict could descend on the land of Westeros at any time. Similarly, an extended period of trouble may hit the crypto industry. Hence the term “Crypto Winter”.
What Experts Are Saying; When Will Crypto Prices Rebound?
When it comes to predicting the future of the crypto market, most experts say the “stronger cryptos” shall prevail.
“I don’t expect crypto to come roaring back in a few months as it did in 2021 because the Federal Reserve monetary policy may become a headwind for the asset class,” Johnson says, adding that despite the headwinds, we could still see the cryptocurrency market rise from the ashes.
Crypto data and analysis firm IntoTheBlock’s on-chain data shows that BTC long-term holders increased their holdings by 180,000 BTC, about $3 billion, since the FTX collapse.
Lucas Outumuro, head of research at IntoTheBlock, also said that “historically BTC long-term holders accumulate strongly in the depths of the bear market” and “begin selling following all-time highs.”
“I would say that is most likely the main strategy Bitcoin believers are aspiring to recreate based on this on-chain data.”
But some investors love the pullback, viewing it as a time to double down on the market for the long term.