Since its inception in 2009, bitcoin, the world’s first and best-known cryptocurrency, has had a bumpy ride. Bitcoin, which is infamous for its extreme volatility, has seen some of the most dramatic price crashes of any asset in financial history. Now it’s February 2025, and the price of Bitcoin sits at about $25,000, a steep drop from its all-time high of nearly $70,000 in 2021. Here are the 10 largest falls in Bitcoin history, what caused them, and what we can learn from these crashes.
2011: The First Major Bitcoin Crash
Price Drop: $32 → $0.01 (99.9% drop)
Cause: Mt. Gox Hack
Bitcoin’s first major crash occurred in June 2011 after hackers broke into Mt. Gox, then the world’s largest Bitcoin exchange. It fell from $32 to 0.01 in days. This crash rattled the young cryptocurrency market and called into question the viability of Bitcoin.
What We Learned: In the world of cryptocurrency, security matters.
2013: The Silk Road Crash
Price Drop: $266 → $50 (81% drop)
Cause: Shutdown of Silk Road
In October 2013, the FBI closed Silk Road, an online black market that relied on Bitcoin for transactions. The news sent investors into a panic, triggering a massive sell-off. In a matter of days, Bitcoin’s price crashed from $266 to $50.
The lesson: Bitcoin’s ties to crime can deeply affect its price.
2013–2014 — The Mt. Gox Collapse
Price Drop: $1,242 —> $200 (84% drop)
Cause: Mt. Gox Bankruptcy
In early 2014, Mt. Gox — then the largest processor of Bitcoin transactions, with more than 70% of the Bitcoin market — filed for bankruptcy when hackers stole 850,000 Bitcoins (or $450 million at the time). This resulted in a multi-month bear market, during which Bitcoin’s price dropped from $1,242 to $200.
TAKAWAY: Escape from centralized exchanges, hacks, and mismanagement.
2017: The China Ban
Price Drop: $5,000 to $3,000 (40% drop)
Reason: The Ban on ICO and Exchanges in China
In September 2017, China outlawed Initial Coin Offerings (ICOs) and closed domestic public cryptocurrency exchanges. Bitcoin’s price fell from $5,000 to $3,000 within a few weeks as a result.
That said, a lesson learned: Government regulations can have a major effect on crypto prices.
2018: The Crypto Winter
Price Cut: From $20,000 to $3,200 (84% cut)
Cause: Market Saturation and Regulatory Concerns
Bitcoin peaked at nearly $20,000 in December 2017 before entering a prolonged bear market that became known as the “crypto winter.” By December 2018, it had dropped to $3,200, as the market was saturated and investors lost their confidence due to regulatory purposes.
The Takeaway: Crypto investing, like investing in anything opportunistic, generally comes in cycles.
2020: The COVID-19 Crash
Price Decrease: $10,000 —–> $4,000 (Over 60% Off)
Cause: Global Pandemic
During the COVID-19 pandemic in March 2020, a global financial crisis caused a tremendous sell-off across all asset classes — as well as Bitcoin. In a matter of days, the price plummeted from $10,000 down to $4,000.
Takeaway: Cryptocurrencies are subject to global economic shocks.
2021: The Elon Musk Effect
Pricing: $64,000 to $30,000 (53% price drop)
Reason: Tesla’s Bitcoin U-Turn
In May 2021, Tesla CEO Elon Musk announced that the company would no longer accept Bitcoin as a form of payment, citing environmental concerns. It triggered a sell-off, which sent Bitcoin crashing from $64,000 to $30,000 in just weeks.
See What the World Has Learned: You may have heard it before, even those who are untrained in wonder when it comes to crypto.
2022: The Terra Luna Collapse
Price Drop: $48,000 → $17,000 (65% drop)
Cause: Collapse of Terra Luna
The cryptocurrency market saw a huge sell-off in May 2022 following the collapse of the Terra Luna ecosystem, which included the stablecoin UST. Bitcoin fell from $48,000 to $17,000 in a matter of months.
Lesson: One failed project can have greater repercussions across the entire market.
2023: The FTX Scandal
Price Drop: $21,000 to $15,000 (29% drop)
Cause: FTX Bankruptcy
However, in November 2023, the FTX collapse, one of the largest cryptocurrency exchanges, had shaken the confidence of investors. Bitcoin’s price fell from $21,000 to $15,000 in a matter of weeks.
Lesson Learned: In the world of cryptocurrency, trust is paramount.
2024: The SEC Crackdown
→ Price Drop: From $40,000 → $25,000 (37% drop)
Cause: SEC Lawsuits
2024: U.S. securities regulators, including the SEC (U.S. Securities and Exchange Commission), filed lawsuits against several major cryptocurrency exchanges, including Binance and Coinbase, claiming they had sold unregistered securities. This resulted in a rapid sell-off, with Bitcoin’s price crashing from $40,000 to $25,000.
From these, we learn that regulatory actions affect cryptocurrency prices.
What’s There to Learn from These Crashes?
Volatility is Inevitable: Bitcoin prices are highly volatile, so investors must be ready for sudden declines.
Regulation: Government policies and regulations can greatly influence crypto prices.
Security Is Everything — A hack or security breach can cause huge losses.
Market Fluctuations: Cryptocurrencies experience cyclical bull and bear markets, and investors must be ready for both.
Final Thoughts
Bitcoin’s past has been characterized by wild fluctuations, based on a myriad of factors, from hacks and regulatory moves to market cycles. These crashes may be devastating, but they do provide investors with some valuable lessons. Investors can approach the potentially volatile world of cryptocurrency investment with more confidence by being aware of the inherent risks and keeping up to date.
Bitcoin’s history has been one of extreme rises and falls based on everything from hacks and regulatory action to market cycles. These crashes can be devastating but they also provide important lessons for investors. It is important to stay abreast with information and understand the risks involved and prioritizing the information can help investors to move ahead in the volatile world of cryptocurrency investments with less fear.
Between October 2023, and February 2025, Bitcoin faces new hurdles and competition from other coins, regulators, and technological advances. However, its survival through numerous market downturns has shown that it is more than just a speculative financial product: it is a revolutionary technology that threatens to disrupt the entire financial system.
