2021 saw all-time highs broken throughout the year followed by a series of harsh corrections. Today, as we head towards 2022, it’s worth asking whether another major Bitcoin crash is on the horizon, or if BTC will enjoy a stronger end to Q4.
Bitcoin is a famously volatile asset, but following a series of good news surrounding major institutional acceptance, it was hoped that more stability would be secured across the cryptocurrency market.
These hopes were dashed in April 2021 as Bitcoin shed more than 50% of its value in the space of little more than a month.
As Visual Capitalist data shows, the correction may have shaken up plenty of 2021’s newcomers to the crypto market but the scale of the crash corresponded with the coin’s history of significant price drops – with the current record dip standing at some 86.7% between 2013 and 2016.
As the table above shows, despite its long history of crashes, Bitcoin has still been extremely successful in terms of its impressive rallies and price accumulation.
At present, Bitcoin sits near its all-time high price, but there appears to be little clarity on what the world’s oldest cryptocurrency will do next. Whilst some speculators are expectant of a major bull run, the disappointing performance of BTC in recent weeks has led to others predicting the beginning of a sharp downturn and bear market. With this in mind, let’s take a look at the history of Bitcoin to see if we can identify whether a crash may be on the way:
Learning from Bitcoin’s Cycles
Arguably the most important quality that Bitcoin has in relation to most other cryptocurrencies is its scarcity. When Bitcoin’s pseudonymous creator, Satoshi Nakamoto, built BTC, he opted to program the asset to undergo a ‘halving’ event every four years in a move that would continually halve the number of BTC rewarded to miners over time.
These halvings have occurred three times in the past, in 2012, 2016, and…
