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Worst crypto cycle ever? Community and history say otherwise

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2 months ago

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The cryptocurrency market has faced a significant downturn since the start of 2025, with some investors calling it the most painful cycle in history.

Some were disappointed about industry policy changes and the memecoin craze in the United States, while others even speculated about talent leaving the sector for other industries.

However, while the current crypto market state might look grim to some, the current cycle is far from being the most brutal on record, and many community members remain bullish.

“For those who have been through multiple cycles, this is just part of the process,” Trezor analyst Lucien Bourdon told Cointelegraph.

The post-Trump inauguration sale

The current decline in crypto markets came after Bitcoin (BTC) reached an all-time high above $106,000 in December 2024, with the spike largely attributed to optimism around Donald Trump’s victory in the US presidential election.

While many were optimistic, some investors, such as BitMEX co-founder Arthur Hayes, accurately predicted a crypto sell-off following Trump’s inauguration on Jan. 20.

Bitcoin price chart since October 2024. Source: CoinGecko

Since then, Bitcoin has tumbled more than 18%, with the total crypto market capitalization erasing almost all gains that came from Trump’s election win, dropping 25%.

In the post-Trump inauguration sale, investors offloaded about $4.6 billion from crypto exchange-traded products by March 7, while the spot market saw even more outflows, with at least $1 billion in liquidations in a single day on March 3.

What was the most brutal crypto sell-off in history?

But the most recent sell-off is not the worst on record. “If we’re talking about the worst Bitcoin cycle, 2014–2015 was possibly the most brutal,” Trezor’s Bourdon told Cointelegraph.

Referring to the collapse of the Mt. Gox crypto exchange, which suffered an 850,000 BTC loss in a security breach in 2024, the analyst highlighted the event as the worst Bitcoin sell-off on record. 

Bitcoin price chart in the period from July 2013 to July 2016. Source: CoinGecko

“The Mt. Gox collapse wiped out 70% of Bitcoin’s trading volume, leading to an 85% drawdown in a market with no institutional support and far less liquidity,” Bourdon said.

More than just falling prices

According to Brett Reeves, head of BitGo’s European sales, there is a “great deal more to just falling pieces” in the current market.

In addition to bigger price downturns in the past, Reeves highlighted notable advancements in global crypto products and regulation, which point to crypto assets increasingly becoming integral to the international financial system. He said:

“While prices may be crashing for now, we must remember how far we’ve come in a short space in time and just how much potential this space has in the years ahead.”

Contrary to crypto doubters and pessimists, some industry executives even see the current market cycle as a bull market.

Related: EU retaliatory tariffs threaten Bitcoin correction to $75K — Analysts

“I actually think it’s the best,” Quantum Economics founder Mati Greenspan told Cointelegraph, adding:

“What sets this bull market apart from previous crypto bull runs is that it’s the first time we’ve seen prices rising over time that is not accompanied by copious money printing. This pullback is a short-term pain that will enable long-term gain.”

According to crypto analyst Miles Deutscher, terms like “bull market,” “bear market,” “cycle,” or “altseason” are not even suitable for the current market situation.

Source: Miles Deutscher

“This is a different market now,” he said in an X post on March 13.

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Coin Market

Binance co-founder CZ proposes Bitcoin, BNB for Kyrgyzstan reserves

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18 minutes ago

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May 5, 2025

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Binance co-founder Changpeng “CZ” Zhao has proposed Bitcoin and BNB as the first digital assets to build Kyrgyzstan’s national crypto reserves.

On May 5, Zhao shared on X that he had advised Kyrgyzstan to start with Bitcoin (BTC) and BNB (BNB) when building its national crypto reserve. In 2024, Forbes claimed that Zhao holds about 94 million BNB tokens, or 64% of BNB’s circulating supply. At the time of writing, these tokens are worth about $55 billion. 

The proposal followed Zhao’s earlier announcement that he had begun advising Kyrgyzstan’s National Investment Agency (NIA) on blockchain and crypto-related matters.

On April 3, Zhao confirmed he’s been officially and unofficially advising governments on crypto frameworks and blockchain solutions. The former Binance CEO said that he finds the work extremely meaningful. 

Source: Changpeng Zhao

Binance to launch crypto payments in Kyrgyzstan

A month after CZ announced his role in advising Kyrgyzstan, Binance announced a partnership with the country to launch a crypto payments service. 

On May 4, Binance signed a memorandum of understanding (MOU) with the NIA to introduce Binance Pay to the country, enabling crypto transactions. The partnership also aims to boost crypto education in the country, with Binance Academy set to work with government agencies to develop blockchain-focused educational programs. 

On April 17, Binance CEO Richard Teng said in a Financial Times interview that the exchange had been advising countries on crypto reserves. 

Kyrgyzstan has been making moves to become a digital asset-friendly jurisdiction. On April 17, Kyrgyzstan President Sadyr Zhaparov signed a law authorizing a central bank digital currency pilot project while giving the national currency’s digital form a legal tender status. 

Related: Pakistan appoints Changpeng Zhao as crypto adviser as adoption heats up

Kyrgyzstan reportedly plans a gold-backed stablecoin

The country also reportedly plans to launch a gold-backed stablecoin. The gold-backed stablecoin will be pegged to the United States dollar and called the Gold Dollar (USDKG). This will be backed by $500 million in gold provided by the country’s Ministry of Finance. 

Cointelegraph reached out to the country’s Ministry of Finance to confirm the reports but did not get a response before publication. 

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Coin Market

Strategy, Semler bag 2K Bitcoin as price edged toward $100K last week

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18 minutes ago

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May 5, 2025

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Michael Saylor’s Strategy, one of the world’s largest corporate Bitcoin investors, slowed its BTC purchases last week as the cryptocurrency briefly surged above $97,000.

Strategy acquired 1,895 Bitcoin (BTC) for $180.3 million during the week from April 28 to May 4 at an average price of $95,167 per BTC, the firm announced in its latest Form-8 filing with the US Securities and Exchange Commission.

Strategy’s latest Bitcoin purchase is one of the smallest made by the company this year, alongside a comparatively meagre 130 BTC purchase in March.

Source: Michael Saylor

The latest buy is 87% less than the previous purchase of 15,355 BTC announced last Monday.

Semler boosts buying despite rising prices

While Saylor’s Strategy cooled its Bitcoin buying spree last week, others upped their appetite for BTC.

Semler Scientific, a publicly traded US healthtech firm, bought 167 Bitcoin for $16.2 million in the period from April 30 to May 2 at an average purchase price of $97,093 BTC.

Announced on May 5, the purchase by Semler was up at least 50% from the previous 111 BTC purchase by the firm announced on April 25.

Bitcoin price chart in the past 30 days. Source: CoinGecko

As of May 2, Semler held 3,634 BTC, acquired for an aggregate of $322.3 million at an average purchase price of $88,668 per BTC.

Semler’s Bitcoin holdings are considerably smaller than Strategy’s, which held 555,450 BTC as of May 4, acquired for $68,550 per BTC.

This is a developing story, and further information will be added as it becomes available.

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Crypto funds raked in $2B last week, pushing 3-week haul to $5.5B

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1 hour ago

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May 5, 2025

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Cryptocurrency investment products attracted $2 billion in new inflows last week, according to the European investment firm CoinShares.

Global crypto exchange-traded products (ETPs) have added $5.5 billion in inflows in the past three weeks, according to the latest weekly report from CoinShares.

With the new inflows, total assets under management (AUM) in all crypto ETPs worldwide jumped 3.3% from $151 billion to $156 billion.

Although the positive trend has continued for the past three weeks, the latest weekly inflows were down 41% from last week’s $3.4 billion of inflows — the third-largest crypto ETP inflows on record.

Inflows slowed down despite new Bitcoin gains

The slowdown in crypto ETP inflows came despite Bitcoin (BTC) seeing some brief gains last week, with the price rising from about $94,300 on April 28 to an intraweek high above $97,000 on May 2, according to data from CoinGecko.

In the trading week from April 28 to May 2, Bitcoin saw $1.8 billion of inflows, down 43% from the week before.

Crypto ETP flows by asset as of May 3, 2025 (in millions of US dollars). Source: CoinShares

However, bearish investors increased positions as short Bitcoin ETPs saw a 300% spike in inflows compared to the previous week, up to $6.4 million from $1.6 million.

Altcoins Ether (ETH) and XRP (XRP) saw ETP inflows of $149 million and $10 million, respectively.

Related: BlackRock Bitcoin ETF buys $970M in BTC as inflows surge, boost market

With Bitcoin accounting for 98% of all year-to-date crypto ETP inflows, total inflows this year amounted to $5.6 billion as of May 3.

Inflows concentrated with BlackRock’s iShares

According to CoinShares data, crypto ETP inflows were highly concentrated with BlackRock’s iShares products, which saw as much as $2.7 billion last week.

Still, crypto ETPs by issuers like ARK Invest and Fidelity Investments were bleeding last week, with outflows amounting to $458 million and $201 million, respectively.  

Crypto ETP flows by issuer as of May 3, 2025 (in millions of US dollars). Source: CoinShares

Other issuers such as Bitwise, Grayscale and ProShares recorded minor outflows for their crypto ETP products last week, totaling $36 million, $31 billion and $25 million, respectively.

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