Capitulation
In cryptocurrencyCryptocurrency is a digital or virtual currency that uses cryptography for security and operates independently of a central bank. Cryptocurrencies use decentralized technology called blockchain... trading, capitulationIn cryptocurrency trading, capitulation refers to a situation where investors or traders give up their positions in a particular asset or market after experiencing a... refers to a situation where investors or traders give up their positions in a particular asset or market after experiencing a significant downturn. This is often the result of panic selling or a sudden loss of confidence in the market.
For example, during the 2018 crypto bear marketA bear market is a term used to describe a prolonged period of time when prices of assets, including cryptocurrencies, are decreasing, and investor sentiment..., BitcoinBitcoin is like a digital treasure that you can use to buy things online. It's like having a secret code that only you know, and... experienced a prolonged decline in price from its all-time high. As the price continued to drop, some investors and traders may have become overwhelmed with fear and uncertainty, leading them to sell off their holdings in a panic.
Capitulation is often seen as a sign of a bottoming out in the market, as it can indicate that most of the selling pressure has been exhausted. However, it can also lead to further downward pressure in the short term as more sellers flood the market.