The cryptocurrency market has been stuck in a prolonged bear market for several months, while in the last few days, some well-known exchanges announced they will shut down operations.
This sounds like concerning news that could trigger additional panic across the community, yet certain industry participants believe it may also mark the cycle’s bottom.
It’s Always Darkest Before the Dawn
On July 23, BitMEX disclosed that it will cease operations on September 23 this year. The exchange is a well-known name in the industry, existing since 2014 and playing a major role in shaping today’s crypto derivatives market. At its peak, it was among the biggest in the sector and is best known for introducing 100x leveraged perpetual swaps.
New account registrations have already been disabled, while users are strongly encouraged to close open positions and withdraw their funds as soon as possible.
Another popular exchange that will cease to exist due to the unfavorable market environment is BitMart. All trading services on the platform will be discontinued on August 26, while the official shutdown is scheduled for January 31, 2027.
And the list of affected entities doesn’t stop with these names. DEX aggregator Odos will wind down operations on July 30, Dango (the self-proclaimed “Endgame Exchange”) will stop running its L1 blockchain on August 13, and decentralized cloud storage company Storj Labs filed for Chapter 11 bankruptcy protection.
At first glance, it seems like the condition of the crypto sector is only getting worse, but numerous analysts see the upcoming shutdowns as a potential bright spot.
X user Mister Crypto claimed that every bear market in the past has ended the same way – with the demise of a big exchange. They reminded that in 2015, the Mt. Gox collapse was followed by an 11,000% price explosion for Bitcoin. In 2018, Bitgrail went down, and BTC surged by over 2,000%, while in 2022 the cryptocurrency exploded by 700% after the meltdown of FTX. With that pattern in mind, the analyst noted that BitMEX “is dying now,” hinting that a new bull run could be just around the corner.
“The pattern is not a coincidence. The bottom shows up right when the weakest big player finally breaks, because it takes that much pain to kill an exchange that size. And that much pain is exactly what a cycle low is made of,” they added.
Ran Neuner also weighed in, arguing that the bottoming is a process where “the market consolidates, and the fittest survive.” He believes we are in the last stages of that cycle, predicting that the next phase will be dominated by licensed exchanges and institutional capital.
Same Pattern or Not Really?
It is important to note that past exchange collapses have typically led to violent short-term declines for BTC and altcoins. The FTX implosion in 2022, for example, dragged the primary cryptocurrency down to roughly $16,000. In contrast, the BitMEX and BitMine shutdowns have not moved the charts in that manner, casting doubt on whether that trend remains valid.
Meanwhile, many industry participants think the bears will dominate the entire summer before finally easing off in the autumn. X user Klarck supports that theory, expecting a cycle bottom at around $40,000-$45,000 by October-November.
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