Bitcoin Records Its Worst Quarter in Over a Decade

Bitcoin posted its worst quarterly loss in over a decade. The world’s largest cryptocurrency lost about 58% of its value in the second quarter of 2022, according to data from CryptoCompare.

Bitcoin fell from $45,524 at the start of the quarter and was trading at just under $19,000 on Thursday, the last day of the three-month period.

This is the worst quarterly performance of Bitcoin since the third quarter of 2011 when it lost 68.2% of its value.

CoinMetrics data showed that the cryptocurrency fell 39.8% in June, on track for its worst month dating back to 2010 when it became available on the exchanges.

Meanwhile, the price of Ethereum tumbled 69.3% in the second quarter, and is on its way to its worst quarter dating back to its beginning in 2015.

Cryptocurrency prices came under heavy pressure this quarter amid rampant inflation that prompted central banks around the world to raise interest rates and lead to the sale of risky assets, such as stocks and cryptocurrencies.

The collapse in prices also revealed problems with many crypto companies and projects, especially those in the lending space and highly leveraged firms.

A number of notable issues emerged during the quarter. The algorithmic stablecoin terraUSD collapsed in May along with its sister currency, Luna.

TerraUSD was supposed to be pegged to the US dollar. Some stablecoins like tether are backed by real assets like fiat currencies and government bonds. But terraUSD was governed by an algorithm that failed.

Crypto lending company Celsius in June also suspended withdrawals for its clients citing harsh market conditions.

Bitcoin lost about 58% of its value

Meanwhile, cryptocurrency exchange CoinFlex suspended customer withdrawals last week, also citing harsh market conditions.

But CoinFlex has also claimed that longtime crypto investor Roger Ver owes it $47 million. Ver denied that he owed money to the CoinFlex platform.

The liquidity crunch has also hit a crypto hedge fund known as 3AC, which has been liquidated.

The latest downturn is being described as a new crypto winter. It has also affected growth and employment in companies. Coinbase and BlockFi have announced plans to lay off employees.

Bitcoin fell in the previous boom-and-bust cycle from $19,871 in Q4 2017 to $3,170 in Q4 2018. It suffered an 84% decline.

A similar drop of 82.2% was seen in 2014. That was when it fell from $1,239 in the fourth quarter of 2013 to $221 in the second quarter of 2015.

This suggests that we may be in another downturn if the current poor macroeconomic conditions persist. Other investors also expressed a downtrend. A number of investors expect the coin to fall to $8,000.

Recent Articles

Related Stories

Leave A Reply

Please enter your comment!
Please enter your name here

Stay on op - Ge the daily news in your inbox