2022 crypto bear market worst in history: Report

livemint.com:

With inflation and tightening liquidity placing extreme pressure on the over-leveraged crypto ecosystem and Bitcoin (BTC) and Ethereum (ETH) both having traded below their previous cycle all-time highs (ATHs), a first in history, markets have plunged a “great proportion" into unrealized loss with all 2021-22 investors now underwater, according to a report.

A report compiled by blockchain analytics firm Glassnode states that as this financial pain sets in, a large number of investors are liquidating their holdings, locking in record realized losses.

BTC drawdown at 73% below its Nov ATH

Bear market lows have historically been established with BTC drawdowns of 75% to 84% from the ATH and taking a duration of 260-days in 2019-20, to 410-days in 2015.

“With the current drawdown reaching 73.3% below the Nov-2021 ATH, and taking a duration between 227-days and 435-days, this bear market is now firmly within historical norms and magnitude," it states.

BTC falls below half its 200 DMA

Glassnode demonstrated how BTC moving below its 200 Day Moving Average (DMA) corresponds to a bear market and more so, when its prices trade below its 200 week Moving Average.

In the current bear market, the prices of Bitcoin have fallen below half its 200 DMA.

If 200 DMA is considered as a long-term mean, the Mayer Multiple (MM) records price deviations above and below, to denote overbought or oversold conditions, respectively.

For the first time in history, the 2021-22 cycle has recorded a lower MM value (0.487) than the previous cycle's low (0.511). Only 84 out of 4160 trading days (2%) have recorded a closing MM value below 0.5.

Changes to BTC’s fundamental value

On-chain analysis can help assess changes to BTC’s fundamental valuation models