The S&P 500 has now reached a correction territory, which is a 10% decline from its all-time high. A further 10% drop would indicate a bear market. However, is it time to panic? Since Bitcoin was created in 2009, the S&P 500 has gone through multiple 20% corrections.
After the global financial crisis in 2008, the index plummeted nearly 60%. In 2019, during Bitcoin’s bear market, the S&P 500 dropped by 20%, while Bitcoin fell as much as 85% from its peak. The Covid-19 crash in March 2020 saw the index fall almost 40%, with Bitcoin losing 60% of its value. More recently in 2022, the index corrected by 25%, and Bitcoin hit a low of $15,000 after dropping by an additional 25% one month later.
Historically, 10% corrections in the S&P 500 have been frequent. Meanwhile, Bitcoin has dropped 30% from its all-time high during this correction. Looking at past corrections in bull markets, such declines are common, with the most recent 30% correction occurring in August 2024 during the yen carry trade unwind.
