Bitcoin had its worst quarter in a decade

The second quarter of 2022 was the worst for Bitcoin (BTC) in 11 years. In that period, the market's largest cryptocurrency saw a devaluation of more than 58 %, from $46,750 on April 1 to $19,280 at the time of writing, according to CoinMarketCap.

BTC has not seen such a steep quarterly decline since Q3 2011, when it fell 66.62 % – from $15.40 to $5.14.

In the last 30 days alone, in the month of June, the price of BTC has fallen by almost 40 %. Moreover, compared to the peak price that the cryptocurrency reached in November, around $69,000, the decline is already over 71 %.

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The second quarter highlights the fragility of the cryptocurrency ecosystem

This significant price drop comes amid a slowdown in the cryptocurrency market. Above all, the months of May to June brought a number of news and events that affected BTC and the wider crypto market.

In the month of May, for example, the collapse of the Terra ecosystem and the stablecoin UST took place, which affected the entire market. In June, cryptocurrency lending and appreciation platform Celsius rocked the market after suspending customer withdrawals; a decision that is still valid.

And there was a ripple effect that rippled through the markets and affected many companies that suspended withdrawals due to the liquidity crisis. Among the most famous ones are BlockFi, which needed the rescue of the cryptocurrency exchange FTX, the lending platform Babel Finance, and the crypto hedge fund Three Arrows Capital (3AC).

Last month, 3AC defaulted on margin calls (financial collateral required for operations that involve risk) and went into liquidation for $400 million. In addition, this week a court in the British Virgin Islands ordered the liquidation of the company and the Monetary Authority of Singapore accused the fund of breaking the law.

At the same time, traditional financial markets were also shaken last month by rising inflation and interest rates. This mainly affected investments considered risky.

BTC price prediction

In a scenario of little optimism, the predictions for the future of the largest cryptocurrency differ. For example, Fundstrat strategists, who are generally bullish on BTC, have changed their short-term price predictions for the asset. He believes the price could still drop to $12,500.

Robert Kiyosaki believes in something even worse, the author of the bestseller "Rich Dad, Poor Dad" said that he will buy more BTC when the digital currency falls to $11,000.

On the other hand, Bitfury CEO Brian Brooks believes that the price of the asset will rise soon. This is because the BTC network continues to be highly utilized. JPM analysts also take a similar view, suggesting that BTC may have already bottomed out.

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All content in this article is for informational purposes only and does not in any way serve as investment advice. Investing in cryptocurrencies, commodities and stocks is very risky and can lead to capital losses.