The year 2020 served as a pivotal juncture for the global economy, reshaping narratives and challenging established perceptions of both the dollar and cryptocurrency. The role of crypto underwent a reversal, requiring more time to evolve into a global standard.
One of the core concepts behind the creation of Bitcoin was its potential to replace traditional fiat currency. Although the notion of cryptocurrency was groundbreaking and enticing in the short term, it ultimately struggled to withstand the prevailing culture of excessive greed over the long haul.
I’d like to highlight some key events that have taken place in the world of cryptocurrency. Familiarizing yourself with these occurrences will provide you with a comprehensive overview of the current situation and help you form your perspective on the direction we are moving towards.
100s of billion was injected into the market.
The bull market of 2020 was unprecedented in its magnitude, a phenomenon the world had never witnessed before. Almost every coin experienced tenfold growth within a mere month, largely attributed to the mass euphoria triggered by Elon Musk.
Nonetheless, various factors contributed to this phenomenon. People have been chasing the Bitcoin train since 2011, driven by the lingering dream of achieving millionaire status. This aspiration fueled the entire spectacle that unfolded in the tumultuous year of 2020.
Leading up to 2020, there was widespread support for the idea that the absence of regulatory oversight in the crypto bubble was a positive aspect. However, this narrative worked to the detriment of the crypto world, leading people to fall prey to scams.
Numerous individuals found themselves victims of ‘rug-pulls,’ revealing the false premise that had been believed. It became apparent that anyone could create fraudulent coins and promote them through platforms like social media, where platforms like Telegram played a pivotal role.
Seasoned participants in the crypto world, who had invested as early as 2011, began to recognize the necessity for regulatory measures. This realization created a significant divide between the newer and more experienced users.
The “Rugpull” culture started in 2020: BSC coins.
However, the trend of rug-pulls through crypto scams had its origins in 2018, but it reached its peak in 2020. This surge in fraudulent activities was closely associated with BSC (Binance Smart Chain) coins. BSC coins are a product of the Binance Smart Chain ecosystem, where users can create these coins using BNB as a transaction fuel.
Functionally, BSC coins emulate the Ethereum smart contract concept. Ethereum, conceptualized by Vitalik Buterin during the era of Bitcoin’s popularity, introduced a new cryptocurrency paradigm.
Ethereum differed from Bitcoin in that Bitcoin was a singular cryptocurrency, while Ethereum operated more like a versatile computer program. Within the Ethereum framework, users could create their own currencies, effectively building new coins within the Ethereum ecosystem. Transactions involving these coins required Ether (Eth) as fuel.
As the value of Ethereum soared above a thousand dollars in 2020, the cost of using Eth as fuel for transactions in Smart Contract coins, created within the Ethereum bubble, also increased. This made it financially challenging for the general population to acquire Eth coins.
The inception of the rug-pull culture can be attributed to the HOGE coin. Numerous individuals made substantial profits; what took Bitcoin a decade to achieve, this coin accomplished in a month. However, when the price of HOGE started to decline, it resulted in substantial losses for many.
Then came the Binance Smart Chain Rugpull.
Coins like Bunny were already present in the market and then came SAFEMOON. Following SAFEMOON, the Elongate fiasco unfolded. The interesting aspect of the BSC coin’s popularity was its affordability.
During that period, the value of BNB was merely 200 dollars, which later peaked at 700 dollars. This affordability allowed many users to purchase Binance Smart Chain coins, utilizing the inexpensive BNB as fuel for each transaction. The rug-pull phenomenon became so prevalent that numerous users actively searched for new coins, held onto them for a week, witnessed substantial gains, and ultimately sold them off in the market.
Many developers ran away, making millions. One such case was the coin called Spacedoge. There is another story about the coins like Holo and Chiliz (CHZ).
The rise of the Dogecoin
As I mentioned earlier, people experienced regret for missing the Bitcoin train. And when the world’s richest man promoted Dogecoin on Twitter, numerous individuals enthusiastically joined the Doge hype.
The 0.003-dollar coin swiftly soared to 0.7 dollars within a span of five months. Hundreds of billions of dollars flooded into the Doge economy. This coin marked the pivotal moment that ignited the rug-pull culture in 2020.
Finally, when Dogecoin faced a decline, it marked the beginning of a bear market within the worldwide economy. This downturn affected even the stock market. The inception of the GameStop (GME) phenomenon can be attributed to a “Fear of Missing Out” (FOMO) sentiment that was ignited by the Dogecoin frenzy.
Bear market 2022
Bear market 2022 is the result of the year 2020. Bitcoin gave birth to the idea that everyone could become a millionaire, which was true in the case of early Bitcoin holders.
Coins like XRP hit their top in 2017 Bullrun and have remained quiet for another five years. All the meme coins took away billions in losses. The year 2020 changed everything.
The dreams of many people have become dreams again. They say you don’t lose if you don’t sell, but you don’t gain if you don’t sell. The world is waiting for the next bull run, which could take years. For now, it’s like the Stone Age with no new inventions or innovations. Now we are treading on a new path.