The complete crypto market is subsiding now for a while and for the past few months. One of the largest American Crypto Exchange platforms Coinbase is recognizing a deep fall of 70% in its share prices. Crypto market researchers are considering the multiple events of pricing sink in the industry as a result of ‘Crypto Winter’.
Whereas Brian Armstrong, the CEO of Coinbase has stirred the confusion on fears of bankruptcy through one of his tweets yesterday. He stated that the latest quarterly filing of Coinbase in the US Securities and Exchange Commission (SEC) has been done as per the new sections added in the regulatory affairs. He further added that the company’s conditions are in good health and there is no risk of bankruptcy.
According to NASDAQ reports Coinbase shares were at $283 last year at this time, whereas today the current price is denominated as $53. This is 81% down. Also, the prices of some of the major cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), TerraUSD, LUNA, Solana (SOL), and Polygon (MATIC) were recorded on a downside.
The company has disclosed a first-quarter loss of $429.7 million on $1.2 billion revenue where the per-share price is $1.98. If compared to last year’s statistics, Coinbase earned $387.7 million on $1.8 billion of revenue and the per-share price was $3.05. According to FactSet Analysts, they have projected a further loss of 1 percent share on revenue of $1.5 billion. In Addition, the company expects a further decline in the monthly number of users as well as in trading volumes in the second quarter of this year.
What is Crypto Winter?
The crypto market is highly volatile and unpredictable in nature. It is mostly driven by user sentiments, and sometimes by emotions. The market cycle pattern when reaches a steep decline where the coin prices are flat for a prolonged period of time, that event or period is termed as ‘Crypto Winter’.
Other combinations of reasons to onset crypto winter include low-priced coins, any post by eminent personalities like Elon Musk, accumulation of crypto assets at major dips, war scenarios, and many others. Nevertheless, crypto winter has often been recognized as an opportunity also.
According to financial analysts at CNBC, a crypto winter occurs when Bitcoin falls under $20,000. Therefore, other major cryptocurrencies are affected largely at every pace. Also, cryptocurrencies tend to follow a 4-years cycle rue where the price of Bitcoin would shoot up just like it did in 2013 and 2017. According to the cycle, Bitcoin should jump in 2021, and indeed it did in the third and fourth quarters of the year. Furthermore, each cycle has four phases: exponential price, correction, recovery, and continuous rise.
Vitalik Buterin considers that crypto winter holds multiple opportunities for small businesses, and developers and is not always bad. This phenomenon possesses possibilities to give birth to many technological advancements for future generations. Experts believe that in 2024 the market will go bullish even more and to combat that the industry has a time frame of 2 years to boost the technology and eliminate short-term speculations.