A bear market refers to a period when prices of cryptocurrencies decline significantly, typically by 20% or more from recent highs. During this time, investor confidence wanes, leading to increased selling and negative sentiment.

Bear markets can be triggered by various factors, including regulatory concerns, market speculation, economic downturns, or negative news surrounding specific projects. As prices drop, many traders and investors may panic, further exacerbating the decline. In this environment, it’s common for investors to adopt a more cautious approach.

Some may choose to hold onto their assets, hoping for a recovery, while others may look for opportunities to buy at lower prices. Bear markets can last for extended periods, making it essential for participants to stay informed and adapt their strategies. Understanding market trends and remaining disciplined is crucial during these challenging times.