Is crypto in another bubble? What you need to know

Bitcoin broke the $64k recently, and the question everyone is asking is inevitable: are we back in a bubble?

What is a crypto bubble

Basically, it is when the price completely disconnects from the real value. People enter due to FOMO, the media amplifies the hysteria, and eventually… crash. Without tangible assets backing them, cryptos are especially vulnerable to this cycle of hype → euphoria → panic → collapse.

The typical cycle

1. Initial hype: New project, new promise, everyone is talking about it
2. Mass speculation: Traders sniff quick profits
3. Media + influencers: It goes viral, ignorant retail money comes in
4. Crazy Prices: They disconnect from reality
5. The peak: Negative news arrives or simply fresh money runs out
6. Panic: Everyone sells at once, brutal crash

Painful Precedents

• 2011: Bitcoin rose from cents to $30, then collapsed to single digits.
• 2017-2018: BTC to nearly $20k, then to $3k. Bonus: the ICO bubble left thousands of scams.
• 2018: Altcoins at all-time high, then lost almost everything
• 2021-2022: Bitcoin reached $68k, NFTs were selling for millions… both collapsed

Warning signals

• Increases of 100-300% in days/weeks
• They dominate social networks and headlines
• Extreme volatility ( swing of 20% in hours )
• Trading volume spiked
• Leverage and margin trading at their peak
• Fear & Greed Index at extremes

How to protect yourself

• Take profits: If you see signs of a bubble, sell partially
• Monitor data: Volatility, trading volume, market capitalization
• Use stop-loss: Make sure you have a floor
• Think long term: Bubbles hurt, but strong projects survive.
• Avoid FOMO: It's your number one enemy

The inconvenient truth

Crypto bubbles are inevitable as long as there is speculation. But they are also learning opportunities. Each collapse teaches: review fundamentals, understand the technology, ignore the hype. Those who survive several bubbles learn to identify which is a real project vs. a scam with pretty marketing.