But is it on its way back?
For all the people who had invested back in December, when the surge of cryptocurrencies seemed unstoppable, the crash of early 2018, and the barren first quarter that followed was a harsh lesson to learn about the volatility and general craziness of the cryptocurrency market and space. It's a relatively unwelcoming place for newbies at the best of times, nevermind during a crash.
No-one's entirely sure what sparked the crash (it's cryptocurrency – no-one's entirely sure about anything in this space), but there are certain events that have been accepted as potential causes.
The selling of a large number of bitcoin by the bankruptcy trustee of the now-defunct Japanese bitcoin exchange Mt Gox is thought to have caused a big dip in the market that, coupled with negative messages broadcast via mainstream media, and the fear new investors had of losing all their money, led to a large sell-off as people fled the market fearing the end of cryptocurrencies (as has been incorrectly predicted many times before, by the way).
So we had hysteria that led to all-time highs in December, and hysteria that led to a massive crash in January and February. And people wonder why it's taking the rest of the world so long to get involved...
Prior to the crash, the number of people opening Coinbase accounts and searching for Bitcoin on Google had spiked to unprecedented levels, but since, as could be expected, the fervour and interest has diminished.
The chart above paints an accurate picture of the world's opinion on cryptocurrencies right now. While early adopters and investors are as bullish as ever, the rest of the world, the 99% who have yet to jump on board? Well, they've been stung. And their trust and confidence will be hard to win back.
March saw a lot of sideways movement in the market, a steadying of the ship, but April and now May have seen confidence returning, highlighted by the steady movement back up to a market cap of around $460 billion. Still a long way from the all-time high, it nevertheless creeps back towards the $500 billion mark, and what you feel is an important psychological barrier.
The market also feels like it's matured a little since taking that big hit earlier in the year, which is important for future investor confidence. Institutional money, the really big players on the world's financial stage, will not throw their immense weight behind cryptocurrencies until the market becomes less volatile.
There's a general consensus among the crypto community that a more sensible, mature market, while nowhere near as exciting to watch on a day-to-day basis, will be a necessity for mass adoption to occur. And that's what we all want to see. Not just for the return on investment, but for the success of cryptocurrencies in general. There are some companies out there doing amazing things in this space, but without mass adoption, they'll never realise their ambitions.
So keep an eye on the crypto market cap over the next few days and weeks. It'll be interesting to see what happens should the $500 billion barrier be surpassed.
What do you think? Are we seeing the crypto market grow up? Or is this just the calm before another storm? Thoughts below, please!