Roughly six months ago, bitcoin and a number of digital assets reached all-time highs and the crypto economy crested above $3 trillion in value. Today is a different story as a great majority of cryptocurrencies are down between 57% to over 80% against the U.S. dollar.
While Cryptos Are Down From the ATHs, 2020 Holders Are Still in the Green
On November 9, 2021, or 196 days ago, the crypto economy was valued at over $3 trillion, and today it’s worth roughly 56% less at $1.31 trillion. Six months ago, bitcoin (BTC) touched an all-time high (ATH) at $69K per unit and today, it’s down more than 57% in USD value.
The second leading asset, ethereum (ETH), has lost 59.85% after reaching $4,847.57 per ether six months ago. The fourth-largest crypto asset BNB is down 52.65% after tapping $689 per unit. XRP is not even close to its January 07, 2018 ATH the digital asset tapped four years ago when it reached $3.40 per coin. XRP today is down more than 87% against the U.S. dollar from that point in time.
Since November 10, 2021, or roughly six months ago, bitcoin (BTC) changed hands for $69K per unit. At the time of writing, bitcoin has lost more than 57% since its all-time price high.
Cardano (ADA) hit its ATH nine months ago at $3.10 per ADA and currently, ADA is down 83.5% against the U.S. dollar. Solana (SOL) touched its ATH seven months ago and is down 81.5% in USD value.
The tenth-largest crypto asset today, dogecoin (DOGE) is down 88.8% from the meme coin’s ATH a year ago. While prices are down since 2021’s high, crypto investors that purchased digital assets in 2020 have seen it their cryptocurrencies rise. For instance, the price of bitcoin (BTC) since 2020 is up 303.28% and ethereum (ETH) is up 465.70%.
The same can be said for many of the top coins today. Binance’s BNB token has jumped 173.53% in two years and cardano (ADA) is up 443.83%. Gains are even bigger for those who purchased crypto assets in 2017 as bitcoin (BTC) is up 1,294.85% since that year. The second leading crypto asset ethereum (ETH) is up 8,985.15% since 2017 against the U.S. dollar.
XRP holders have seen the most gains since 2017 as XRP has skyrocketed in value by 31,346.47% during the last four years. 2017 was a bullish time for crypto investors as BTC hit an all-time price high that year at $20K per unit and 2021 was similar in terms of bullish price values.
Crypto’s Strong Correlation With Stocks, 289-Day Bear Runs, and Further Capitulation
Market strategists believe most bear markets have a duration of just under 9.5 months. Moreover, in recent times cryptocurrencies have been correlated with equities markets and more specifically stock indexes like Nasdaq 100 and the S&P 500. This could mean that the crypto bear market won’t end until the stock market bear run is finished.
Bank of America strategists recently detailed that the S&P 500 has recorded a total of 19 bear market cycles. The average duration for each cycle was roughly 289 days and the S&P 500’s average bottom was 37.3% lower than the ATH.
If cryptocurrencies are to follow the pattern, it could mean the bearish sentiment could last another three months longer, if history repeats and digital assets continue to follow the current correlation with equities. Unfortunately for crypto investors, S&P 500’s average drop of 37.3% is nothing like the lows the crypto economy has seen during extreme capitulation. Three bitcoin (BTC) bottoms have been more than 80% lower than the ATHs recorded during the bull cycle.
While the top ten crypto assets are down 57% to over 80% already, prices could go much lower. An 80% drawdown from BTC’s $69K high would be $13,800 per unit and an 80% cut in ether’s ATH value would result in a price of $970.
Currently, crypto assets like BTC and ETH are seemingly at a turning point that will take the value one of three ways. For example, the price of bitcoin could consolidate in this region for quite some time, the price could also rise again back into a bullish scenario, or the value drops even lower from here resulting in more capitulation.
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2017, 2020, 289 days, 57% lower, 80% drawdown, ada, all-time highs, Bank of America, bear cycles, Bitcoin (BTC), bnb, BTC, correlation, down from ATH, equities, ETH, Ethereum (ETH), Nasdaq 100, S&P 500, stocks, XRP
What do you think about crypto assets being down 57% to over 80% lower than their price highs? Let us know what you think about this subject in the comments section below.
Jamie Redman
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