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Cryptocurrencies have been on a downward spiral in the past few months with bitcoin (BTC), the top cryptocurrency by market capitalisation, experiencing one of its biggest dips yet.

Currently valued at around $20,000, bitcoin at its lowest had reached $17,000, losing around 75% of its value from its previous $68,000 highs.

June was the worst month for BTC which sealed monthly losses of over 40% for the first time in 11 years. In addition, the cryptocurrency had seen its worst quarterly loss in 11 years as price and activity both plunged on the blockchain in the second quarter of 2022.

However, bitcoin’s current losses are nothing unusual, as the cryptocurrency has seen similar patterns in the past and survived major losses.

Let’s look at some of the cryptocurrency’s biggest dips in history so far:

  • Bitcoin loses 99% of its value in 2011

In June 2011, bitcoin lost over 99% of its value as it dipped from its $32 highs to $0.01 in the course of a few days.

The flash crash appeared on the Japanese bitcoin exchange MtGox, which was largely blamed for it, however, the events that led to the cryptocurrency’s fall were never truly explained.

It is now assumed that a hacker may have obtained access to the account of MtGox’s founder, Jed McCaleb, which appeared to have had administrative rights to the database and thus the hacker was able to manipulate account balances and grant themselves a large number of bitcoins on the MtGox exchange. A major selloff of the assets attained by the hacker is what had likely caused the cryptocurrency’s crash.

Around 850,000 bitcoin was stolen in the aftermath of the hack and concerns over the security of cryptocurrencies stored on exchanges were raised.

It had taken the cryptocurrency around two years to recover from the crash, as it managed to surpass its previous $32 high in February 2013.

  • Bitcoin down 80% in 2015

The next major BTC crash came in 2015, when the cryptocurrency managed to lose around 80% of its value as it crashed from $1,000 highs – a record it hit for the first time ever at the end of November 2013.

After surging to $1,151.13 on 4 December 2013, the cryptocurrency fell to $522.7 in two weeks and continued the bearish trend deep into 2014 and beginning of 2015.

The crash came as the Chinese central bank started to crack down on bitcoin in late 2013, prohibiting local financial institutions from dealing with BTC transactions. It was further affected by MtGox suspending all BTC withdrawals in early February 2014 before filing for bankruptcy in Tokyo and the United States.

Negative sentiment around BTC was negative until the beginning of 2017, when the cryptocurrency managed to surpass its previous $1,000 highs.

  • Bitcoin falls from $20,000 to $3,200 in 2018

Following its recovery from a bearish two years in January 2017, bitcoin managed to gain over 1,900% of its value and surged to $20,000 by the end of the year.

However, the cryptocurrency’s rally was short-lived as it managed to dip and lose over 60% of its value in a couple of months after having reached a peak. By April 2018, bitcoin had already fallen to the $6,000 value and by the end of the year was trading at $3,000 lows.

A different Japanese cryptocurrency exchange, Coincheck, this time was facing security issues after suffering a hack which resulted in the loss of around $530 million of the NEM (XEM) cryptocurrency in January 2018.

Facebook and Google’s ban of advertisements for initial coin offerings and later token sales in March and June 2018 respectively had also put pressure on the values of many cryptocurrencies, including BTC.

In addition, this was also the time when applications started to come in to the US Securities and Exchange Commission for BTC exchange-traded funds which were all declined – another negative hit for BTC.

  • BTC down to $29,000 from $63,000 in 2021

In April 2021, the token had reached $63,000 but soon fell to $29,000 by the end of June 2021.

Overall, 2021 was a very successful year for the cryptocurrency as it managed to surpass the $1 trillion market capitalisation mark, however, news that bitcoin mining had a negative effect on environmental, social and corporate governance (ESG) had dragged the token into bearish territory.

This was further highlighted when Elon Musk’s Tesla, an avid fan of the cryptocurrency which used to accept payments in BTC, dropped bitcoin as a payment method in May 2018 citing ESG concerns.

However, three months later Musk admitted that around 50% of BTC is mined using renewable energy.

“It looks like Bitcoin is shifting a lot more towards renewables and a bunch of the heavy-duty coal plants that were unequivocally being used have been shut down, especially in China. I want to do a little more diligence to confirm that the percentage of renewable energy usage is most likely at or above 50% and that there is a trend towards increasing that number. If so, Tesla will resume accepting bitcoin,” the billionaire said at t “The ₿ Word,” a virtual bitcoin event.

  • BTC down by more than 70% in 2022

After reaching $68,000 at the end of November 2021, its highest value ever, BTC embarked on a bearish trend which saw the cryptocurrency losing more than 70% of its value, down to $19,000 in mid-June 2022.

The plunge to below $20,000 levels was the first since 2020 and had fuelled extra fear and stress around the market.

Bitcoin’s collapse was highly influenced by the crash of the TerraUSD (UST) stablecoin which lost over 80% of its value in May 2022 and caused a domino effect for crypto markets amid massive liquidations and uncertainty.

Many crypto lenders, including Celsius, had to pause crypto withdrawals due to their inability to maintain liquidity as harsh market conditions hit.

Note, cryptocurrency CFD trading is restricted in the UK for all retail clients. 

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