What Is a Bear Market in Crypto?

A bear market is a long stretch when prices mostly fall and confidence drains away. The rough rule is a drop of 20% or more from the recent high that does not quickly recover, and in crypto these have run for a year or more. The name comes from the way a bear swipes downward, the opposite of a bull.

What does a crypto bear market feel like?

Quiet, mostly. Prices fall in steps rather than in one drop, trading volume dries up, projects run out of money and close, and the friends who were asking what to buy in the spring stop mentioning it entirely. The usual name for it is crypto winter, and the picture fits: nothing much grows, and the work that matters happens indoors, out of sight. Bitcoin fell roughly 84% from its 2017 high over the following year, and roughly 77% from its 2021 high over 2022.

What actually happens during one?

Two things at once. Weak things break: the Terra stablecoin collapsed in May 2022, several crypto lenders failed over that summer, and the exchange FTX went under that November, each failure making the next one likelier. Meanwhile the durable projects keep working. Ethereum switched the way it secures itself, from mining to staking, in September 2022 — in the middle of the worst of it. Bitcoin, Uniswap and Aave kept running through both winters without a pause.

What should a beginner do in one?

Less than you would think. Nobody can identify the bottom in advance, so people who try usually spend their money early and have none left when it matters. Buying a fixed small amount on a schedule sidesteps the guessing. Borrowing to buy is what turns a bad year into a permanent loss. And be ready for the recovery scam that follows every crash: a stranger who contacts you first, knows you lost money, and offers to get it back for a fee. That person is a thief, without exception.

The most useful bear-market habit is boring. Keep your coins in a wallet you control, learn something while it is quiet, and ignore anyone who tells you the price is about to turn. If you want to know how some people earn a little while they wait, read about staking.