Let’s presume the worst has already happened to bitcoin and cryptocurrency this year. I mean, what else could hurt more? A drop to $16,000? Bitcoin tumbled from $67,000 to $17,600 already; a few thousands below that level can’t possibly hurt more. Well, pain and fear are irrational and everyone differs in the threshold. Recoveries and consolidation in the past two weeks have seen bitcoin hold its position above $19,000. Altcoins have also seen a tangible rise from previous lows. Albeit, it’s still cloudy and a new low is possible…but not certain. There are no certainties in a space like this.
You heard the news; “bitcoin is dead”. ‘Shitcoins’ will always follow the same route. It was going to zero before it struggled back to $20k. A common event; bitcoin adds a few thousand dollars anytime it’s pronounced dead. Death has a new meaning here. It’s a very weird space, no surprises.
Celsius, Luna, 3AC, each of these played a role in laying bitcoin to rest. Catastrophic news in the middle of a shaky market. Bitcoin was supposed to hold the $30,000 level very tight and bottom out. There’s no way the charts could indicate tragic crashes of three multi-billion dollar projects controlling huge stashes of bitcoin and millions of investors. Just like the $100,000 predictions couldn’t envision an invasion.
Post-halving, a wave of acceptance triggered by institutional purchases and adoption set the crypto space in a frenzy. The greed index was at an all-time high and so was the price. Like fertile soil, the booming market supported the growth of every project. Regardless of the fundamentals, new and existing projects saw incredible growth, price-wise. If you could copy and paste the codes of a decentralized swap platform, you’re well on your way to creating a billion-dollar project. That used to be a wizard-level achievement. Meme coins were doing incredible numbers too. Constant rug pulls couldn’t deter investors from looking for the next quick 1000X.
That’s all in the past now. It was all downhill from bitcoin’s $67,000 all-time high. A few bull market meme coins still trade. The multi-million trade volume and the huge market cap don’t exist anymore though. Apart from Shiba Inu and Doge; the dog-themed meme coins are shrinking out.
The popular belief is that fundamentals rule and projects without good fundamentals will eventually die off. Experimentally, that’s not absolute. We have seen it play out. Even top-tier projects with ‘great’ fundamentals followed the meme coins. We mentioned a few already, many more are yet to be reported.
The market has its way of modifying the space and performing an ‘automated’ cleansing. Thousands of projects, millions of investors. Yet only a percentage of this figure are reputable projects and dedicated investors, respectively. The booming market supports every project and rewards every investor, but times like this make their own choice and sieve the bad out. Pretty strong words, but realistic and earnest.
We are witnessing a classic natural selection at institutional and individual levels. Bitcoin could be dropping in value at an alarming rate, but in fact, the crypto space is purging and healing at the same time. The paper hands who dropped in to make some quick bucks are fast leaving the space. Hopefully, they caught enough 100Xs or preserved their capitals…at least.
When bitcoin drops to $16,000 or lower; the space will be left with diamond hands and investors with a deeper interest in cryptocurrency and bitcoin. The surviving projects will be ones with stronger and more sustainable fundamentals and financial strategies. Projects riding on bitcoin’s wave will have to find a new hitchhike. Cryptocurrency losses are temporal, bitcoin has proven that beyond doubt. But the serenity the bear market brings is vital as well. Bitcoin is trading below $30,000 but it’s thrice healthier than bitcoin at $67,000.