What is a crypto winter?

A crypto winter is a prolonged period when cryptocurrency prices fall sharply and stay low, trading slows, and companies cut staff or fail. The term is informal and has no official start or end date, but it is used to describe downturns that last much longer than a typical price dip.

What does crypto winter mean?

The phrase borrows from the idea of a long, cold season. It describes more than a bad week. During a crypto winter, prices fall across most coins, new projects struggle to raise money, and media and public interest fade. It is closely related to a bear market, which the guide on bull markets vs bear markets explains. The difference is mostly one of tone, as "winter" usually signals a deep and drawn-out slump across the whole industry.

What were past crypto winters?

The 2018 downturn is often the first one people mean. According to Benzinga, bitcoin fell from a peak of about $20,000 at the end of 2017 to a low of around $3,200 in December 2018, and some called that year a crypto winter. Bloomberg Opinion reported that the total value of all cryptocurrencies dropped from roughly $800 billion at the start of 2018 to about $100 billion.

The 2022 slump is the most recent widely cited example. CoinGecko found that total crypto market value fell from about $2.3 trillion at the start of 2022 to $829 billion by year end, a decline of about 64%.

What caused the crypto winter of 2022?

Several failures piled up. In May 2022, the TerraUSD stablecoin lost its dollar peg and it and its sister token fell close to zero. The SEC later said the collapse sent shock waves through crypto markets. Crypto lender Celsius froze customer withdrawals and filed for bankruptcy in July 2022, and the FTC later said it had misused more than $4 billion in customer deposits. In November 2022, the exchange FTX collapsed and filed for bankruptcy. The guide on what happened to FTX covers that story.

How long does a crypto winter last?

There is no fixed length, and nobody can reliably predict when one starts or ends. The 2018 slump lasted roughly a year from peak to low, and the 2022 slump also stretched across most of a year. Because the term is informal, different writers date the same winter differently. For general reasons prices fall, see why crypto is down and why crypto is so volatile.