Current Crypto State – How Bad Is it?

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The Crypto market is currently in a very bad state today. The great crash of Bitcoin and every other cryptocurrency in 2022 has brought many long-term investors in the market a huge devaluation of their portfolios and loss of capital for some traders. 

Investors have further suffered greater losses from their investments with the increasing number of crypto exchanges that have gone bankrupt this year. Over four different crypto exchanges have been declared bankrupt and unable to pay back investors’ deposits with them. 

Several crypto projects have further crashed within this period, leaving investors completely heartbroken over their investments. Is all hope lost for crypto today? Will the market recover again? Can traders still buy Ethereum and other Cryptocurrencies with confidence that the market will recover again? If you are among those curious to find out the way out of this present mess, then you need to read this work carefully to learn more. 

Is Crypto in a bad state today? 

The crypto market is currently in a very bad state today. Some investors have found themselves in great loss after Bitcoin price crashed 65% within the year, falling from its previous all-time high at $69K in  October 2021 to a new low in 2022 at $15462. Altcoins, too have suffered the same fate, with most losing greater value than Bitcoin. Over 90 percent of the altcoins have lost close to 80% of their value in 2022 when compared to their previous highs last year. 

A more miserable situation witnessed by investors this year has been the crash of several crypto projects beginning with the Luna and FTT token. This was followed by the crash of four different crypto exchanges, which had declared themselves bankrupt and unable to process investors’ withdrawal requests. Over $200 billion was wiped out of the crypto industry this year with the crash of the second-largest crypto exchange – FTX. The exchange was found guilty of mismanaging investors’ funds and giving out loans from it its related company known as Alameda Research. This ugly incident has found investors losing trust in dealing with the Centralized cryptocurrency exchanges today.

This incident has further attracted the attention of various regulatory bodies that are now seeking to develop a more comprehensive guideline with which to regulate the crypto industry and protect investors from persistent loss. 

Can the crypto market ever be made whole again?

The most troubling question investors are currently seeking an answer to is whether the crypto market will ever recover again. And if so, when will it be expected to do so? 

Judging from the records and happenings within the industry, there are shreds of evidence that the market has suffered a similar downturn as these in the past but has always recovered over time. For instance, the bear market of 2018 was caused by the hack of a major Japanese crypto exchange – Coinheck, with over $500 Million stolen from this exchange. This led to the exchange halting withdrawals resulting in major panic in the market. 

More crypto projects crashed within this period, too, after their ICO, which caused many investors to lose hope in crypto. The market, therefore, suffered a great crash due to the combined effects of these ugly incidents. At this point, Bitcoin crashed from its high of above 20K in 2017 to a new low of $7700 by February 2018. 

Notwithstanding, the market was quick to recover from this crash in the following years, peaking at 69K in 2021. Analysts who are conversant with the history of the crypto industry are currently optimistic that the market will recover again from the crisis witnessed so far in 2022.