According to Milk Road, a major crypto crash can result in a 70% loss of capital, highlighting the extreme volatility and risk in the cryptocurrency market (source: Milk Road, May 27, 2025). For traders, these significant downturns underscore the importance of robust risk management, diversification, and stop-loss strategies to mitigate portfolio damage during rapid price declines. Understanding such historic drawdowns is crucial for both short-term and long-term trading decisions, especially as crypto market volatility can surpass that of traditional assets.

According to Mihir (@RhythmicAnalyst), there is a question regarding whether the crypto market might experience a crash or reach new lows, suggesting traders should be cautious and consider risk management strategies.