Executive Summary
The Story So Far
Why This Matters
Who Thinks What?
Bitcoin has experienced nine significant price crashes throughout its history, with major catalysts including exchange hacks, regulatory clampdowns in China, global economic panic, and the implosions of major crypto platforms. These events, spanning from 2011 to 2022, led to substantial percentage drops in the cryptocurrency’s value, wiping out billions in market capitalization and leveraged positions.
Key Historical Crashes
Mt. Gox Flash Crash (June 2011)
The most severe crash in Bitcoin’s history occurred in June 2011, when the Mt. Gox exchange, which handled approximately 90% of all Bitcoin trading at the time, saw Bitcoin’s price plummet by an estimated 99.9%. This was triggered by a hacker stealing hundreds of thousands of BTC and selling them for pennies, effectively erasing nearly the entire market’s value.
Mt. Gox Meltdown (April 2013)
Another incident involving Mt. Gox in April 2013 saw Bitcoin drop by about 43%, from $265 to $150. The exchange attributed this to distributed denial-of-service (DDoS) attacks that caused trading freezes and prompted a sharp sell-off.
China Ban Panic (December 2013)
In December 2013, Bitcoin’s price fell by approximately 50%, from over $1,200 to below $600, after the People’s Bank of China prohibited banks from engaging with Bitcoin. This regulatory move significantly impacted investor sentiment.
Another China Ban (September 2017)
China’s ban on Initial Coin Offerings (ICOs) in early September 2017, followed by reports of mandated domestic exchange closures, led to a 25% drop in Bitcoin’s price. Major exchanges like BTCC, Huobi, and OKCoin confirmed shutdowns, shifting global crypto liquidity to Japan and Korea.
Leverage Unwind (December 2017)
Following a rapid ascent, Bitcoin experienced a 33.3% drop in December 2017, falling from $16,500 to $11,000 in 24 hours. The introduction of cash-settled Bitcoin futures contracts on regulated exchanges like CBOE and CME, combined with high leverage, contributed to this market correction, signaling the start of a year-long bear market.
COVID: “Black Thursday” (March 12, 2020)
The declaration of a global pandemic by the World Health Organization on March 11, 2020, led to a widespread market panic. Bitcoin plummeted from just under $8,000 to approximately $4,850, losing almost half its value in a single day, resulting in over $1 billion in liquidated leveraged long positions.
China Crackdown: “Black Wednesday” (May 19, 2021)
In May 2021, a combination of Tesla halting Bitcoin payments and a renewed crackdown by the People’s Bank of China on Bitcoin miners and transactions caused a 30% drop in Bitcoin’s price, from around $43,000 to $30,000, wiping out approximately $8 billion from leveraged positions.
Celsius Freeze and Contagion (June 13, 2022)
The crypto lending platform Celsius froze withdrawals and swaps on June 12, 2022, citing “extreme market conditions.” This event, coming shortly after the TerraUSD collapse, sparked broader liquidity fears and led to Bitcoin falling 15% from $26,000 to below $22,000.
FTX Wobbles Ahead of Bankruptcy (Nov. 8-9, 2022)
Reports of a liquidity shortfall at Sam Bankman-Fried’s FTX exchange triggered widespread panic in November 2022. Bitcoin dropped over 17% in 24 hours, from $20,500 to $16,900, briefly touching $15,600 before FTX filed for bankruptcy, causing significant ripple effects across the crypto industry.
Market Resilience and Volatility
While an October 2025 crypto market crash, potentially linked to a tariff threat from President Trump, wiped out $19 billion in leveraged positions, it did not rank among Bitcoin’s largest percentage drops. These historical events underscore Bitcoin’s inherent volatility and its susceptibility to both internal platform failures and external macroeconomic or regulatory pressures.
