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Bearish Trend in crypto market started from the dramatic collapse of Terra escalated with the insolvency crisis amidst prominent crypto firms. However, despite a slight recovery, the market saw this month, it overall remains to be bearish. At the time of writing, the top cryptocurrency was trading at $22,572.44. While the top altcoin remained below $1,600.
Worst Quarter For Crypto Industry
The crypto industry went through one one of its worst phases in 2022 Q2. Flagship currencies, Bitcoin and Ethereum, recorded their worst performances in history. The top assets experienced a steep fall. Bitcoin dropped by 56.3% while Ethereum suffered a 67.4% decline.
The heavy crisis in the crypto industry was triggered by the Terra collapse. As a result, the booming industry suffered losses worth billions. Three Arrows Capital, a crypto liquidity provider and Celsius Network were among the ones who faced the chill of crypto winter the most.
A crypto data provider, CryptoCompare, did an analysis of the events that occurred in the second quarter. The report says the macro landscape looks extremely serious. A clear warning of the looming recession can be sensed in the crypto space right now.
The major downtrend in the crypto market resulted in total value locked(TVL) significantly dropping. To be precise, TVL declined by 65.7% in this quarter. Similar to the events that occurred in the 2008 Financial crisis, the bear market could become a breeding ground for innovations. Hence becoming a key factor in the next bullish rally in the industry.
The report by CryptoCompare also mentions that the TVL in DeFi is likely to oscillate in a range bound while the cryptocurrencies try to recover from the market crash. The quarter also heard discussion around cyber security and regulations. Following the Terra Collapse, the US treasury Secretary Janet Yelen highlighted the high-risks prevailing in the crypto industry.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
