From Cointelegraph

June 13, 2025 11:34:00 AM:

Crypto market capitulation explained: Investors surrender to fear, leading to massive sell-offs, price drops, high volumes, and pessimism. Capitulation often marks the bottom of a bearish cycle, clears speculation, and offers buying opportunities. Historical data shows major crypto bull runs following severe capitulation events, like Bitcoin’s recovery after the FTX collapse.

Signs of a crypto capitulation event include spikes in fear levels, high volume sell-offs, massive liquidations in derivatives markets, sharp collapse in altcoin prices, and extreme pessimism in social and traditional media. Recognizing these signs can provide a strategic edge in navigating the market.

Post-capitulation periods typically see price stabilization, increased accumulation by smart money, positive divergence in onchain data, and a gradual shift from extreme fear to cautious optimism. Patient and strategic investors may find post-capitulation periods to offer the best risk-reward opportunities in the market.

Understanding the psychology of capitulation is crucial, as fear often outweighs logic during market downturns. Emotional triggers like loss aversion, herd behavior, and narrative collapse can drive panic selling. Recognizing these triggers can help investors avoid reactive decisions and stay focused on long-term strategies.

Capitulation differs from a market correction in its emotional intensity, high volatility, and sharp altcoin crashes. Preparation for or survival during a capitulation event may involve maintaining liquidity, managing leverage carefully, utilizing stop-loss orders, focusing on fundamentals, and filtering market noise. Each investor’s approach may vary based on their goals, risk tolerance, and market view.

Read more at Cointelegraph: Panic or Opportunity? What Crypto Capitulation Tells Smart Investors