How To Survive Crypto Winter In Summer 2022

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Last Updated on 9 July 2022 by CryptoTips.eu

Jeroen Kok

Jeroen is one of the lead copywriters on Cryptotips.eu and discusses all recent events in the crypto market. This includes news updates, but also price analyzes and more. He developed his passion for cryptocurrency during the bull run in 2017. He has learned a lot since then. The combination of cryptocurrency and creative writing is perfect for Jeroen and an excellent way to share his knowledge with a wide audience. Find me on LinkedIn / [email protected]
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Philosopher George Santayana once stated that  “Those who cannot remember the past are condemned to repeat it.” In terms of investing it means that you have to look at past cyclical terms to accept what is going on in the present.

Therefore, if you want to know how to survive the current ‘crypto winter’ of 2022 (which funnily enough is happening during the summer) just look to the 2017-2018 crash (known as the ICO boom) and learn from that happened then.

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Classic bubble territory

Back in 2017, Bitcoin was popping out of its price range and took the whole of the crypto market with it. In a matter of months, the market capitalization of the cryptosphere multiplied 46 times (known as ‘classic bubble territory’) only to reach $829 Billion in January 2018.

Many youngsters (mostly in Japan and South Korea) though they would be rich for the rest of their lives having invested in little known coins that had risen tenfold.

However, January 2018 was also the month Bitcoin (and Ethereum) suddenly crashed and lost 70% of their value in four brutal months. The ICO boom and bust served as a warning. Then, crypto winter set in which lasted until the beginning of 2020 approximately.

By the second half of 2020 Bitcoin was back in the $10k-$20k range and in 2021 it reached a new all time high of $69,000. As from the fall of last year, Bitcoin started dropping in correlation with tech markets like the Nasdaq.

The current ‘crypto winter’

The latest onset of crypto winter started a few weeks ago and could, according to analysts this last up to 12 months unless persistent inflation (which is a global problem) cools down, which would allow the Federal Reserve in the US and the ECB in Europe to ease up on aggressive interest rate hikes that make risky assets less attractive to investors.

The fact that global business banks like Goldman Sachs are willing to risk $2 billion to buy up distressed crypto assets mean more and more Wall Street companies believe in the long term future of crypto.

If inflation shows signs of cooling off, be ready to get back in. In the meantime, beware of dead cat bounces or relief rallies. And don’t forget that spring always follows winter.