Hedera (HBAR) Bounces Back Up after the September 1st Drop

With the start of September 2022, the crypto market has been struggling due to the bearish influence for nearly 10 full months. Many were hoping that the end of summer would bring relief and that the bears would at least withdraw, leaving the market neutral by now. However, as September 1st came around, the market saw another bearish wave hitting it, and unfortunately, prices were slammed back down to their respective bottoms.

This was also the case with Hedera (HBAR), which dropped back down to $0.6, which has been serving as the token’s strongest support level since January 20th, 2021. For the time being, this seems to be its bottom, and hopefully, the token will not sink further than that to 2020 levels.

However, we have noticed that there is interest in Hedera, as the token managed to bounce back up and recover by several percent as of September 2nd, which was a clear indicator that the token has buyers who are waiting for the right opportunity to buy the dip, and in doing so on September 1st, they caused a minor price increase.

What is Hedera?

Before we check out what happened with Hedera's price, let us first see what the token is all about.

Hedera, also known as Hedera Hashgraph, is the most used, sustainable, enterprise-grade public network developed for supporting a decentralized economy. It allows users — which can be individuals or businesses — to create powerful decentralized applications (dApps) on its network.

Essentially, the project was created to serve as a fairer and more efficient system than traditional ones, with the goal of eliminating the limitations that older blockchain-based platforms face. These are issues that have been troubling the crypto industry for years, and they are very well-known to anyone who has spent any amount of time studying crypto and blockchain, including things like great instability, lack of scalability, slow performance, and alike.

The project was founded by Dr. Leemon Baird and Mance Harmon, and it was funded through an ICO that took place in August 2018. After that, it launched open access to its mainnet in September 2019, and ever since then, it has been running quite successfully. As part of its ICO, investors were allowed to buy the platform’s native utility token, HBAR, at the lowest possible pricing.

The token itself plays two roles in the Hedera ecosystem, one of which is to fuel the network’s services, like file storage, regular transactions, smart contracts, and alike. The second use case is to help secure the network through staking, which basically means that users can lock up their tokens and receive regular rewards, while at the same time, they are contributing to the platform’s security and helping it maintain its integrity.

Another thing worth noting is that Hedera was not built on a conventional blockchain, like most other crypto platforms. Instead, it brought a new type of distributed ledger technology called the Hashgraph. This type of tech allows it to improve on the aspects of crypto and blockchain that have been criticized for their lack of efficiency, including speed, cost, and scalability, as mentioned earlier.

So, for example, Hedera’s average transaction fee is only $0.0001, which is practically zero-fee. Plus, the platform can handle over 10,000 TPS, while blockchains like Bitcoin and Ethereum can only do 7 and 15 TPS, respectively.

Hedera historical price performance

Hedera’s earliest price data comes from September 19th, 2019, when the HBAR token’s price sat at $0.057. However, immediately after launch, the price crashed — first to 0.029 and then to $0.01. After this, in early 2020, came a recovery back to $0.03 levels, where the price remained until the end of the year, spending the entire 2020 with only minor fluctuations.

In 2021, however, the project saw a massive change in behavior. Starting on January 3rd, its price started seeing growth — slow at first, but it quickly picked up, pulled by Bitcoin’s own bull run that took the altcoin market by storm. At this point, Bitcoin was already miles past its own previous ATH of $20,000, and nearing the $30k mark. By the time Bitcoin reached $40k, the rest of the market was already following up in one of the largest bull runs that were ever witnessed in the world of finance.

In case of HBAR, the token climbed to $0.4 by March 15th, which was the highest point in its history up to that point. Still, $0.4 ended up being quite a strong resistance, and it even managed to reject the price. The token dropped to a support at $0.3, only to return to $0.4 again on March 30th, 15 days later. The same thing happened again, and again, HBAR crashed to $0.3, and it recovered back to $0.4.

This time, the resistance pushed back stronger, and HBAR price crashed to $0.25, having a much harder time with recovery. While it was working on gathering momentum for another surge, mid-May arrived, and with it, the first major price correction. Many are still debating whether the market crashed in May because Elon Musk announced that Tesla would no longer accept Bitcoin for its electric cars, as the company found that Bitcoin mining is too energy-intensive, which means that it is leaving a massive carbon footprint.

Whether you believe that or not, the fact is that the market crashed around the same time as Musk’s announcement, and the prices ended up roping until July 20th. Hedera’s price dropped as well, this time to $0.2, which was believed to be its bottom at the time. However, on July 20th, the prices started recovering again, leading to an even stronger surge.

While BTC grew until November 11th, when it reached its peak, HBAR’s highest point revealed itself on September 15th — almost exactly a year ago, when the token hit the price of $0.5. It did so in a massive surge that had equally as massive a correction as a consequence, leaving it at $0.3 by September 29th. However, Hedera was not done yet, and it started climbing back up, this time more steadily.

It reached $0.45 on November 12th, which is when the bears finally reached the token, and started pulling it down with the rest of the market. HBAR crashed to $0.22 by December 13th, which was only a month after it all started, and while it did see a small recovery before Christmas, it still ended the year with a price of $0.22.

Hedera price performance in 2022

At the time, crypto users were still not quite sure whether this is a temporary price crash like the one seen in May 2021 or if it was the start of new crypto winter, such as the one seen in 2018. The early days of 2022 only made the situation more confusing, as crypto prices started growing during the first five days of January. HBAR even managed to recover to $0.33, and for a time, everyone thought that the November crash was done and that a new surge is starting.

However, the market revealed its true nature around January 5th, when the bears gripped the prices once again, and this time, there was no more doubt — the bull run was over, and the crypto winter started anew.

By January 24th, Hedera’s price was down at $0.18. Over the next few months, Hedera managed to establish fairly strong support at $0.20, with this level holding during the bearish waves, and it managed to venture up to a resistance at $0.26 during calmer periods. The first such period came in early February, and HBAR found itself at $0.26 on February 7th, only to drop back down to $0.2  by February 22nd.

The situation repeated itself in late March and early April, but as April came to a close, the bear market became a lot more intense, pushing the prices even further down. Hedera, as well as many other coins, saw their supports break, and they sank deeper, seeking new bottoms.

HBAR found its own at $0.06, and so far, this level has managed to hold throughout the summer, supporting Hedera’s price in May, June, July, and even throughout August.

Now, with the arrival of September, many were hoping for a new surge, as mentioned, and the last few days of August even encouraged this belief. However, September 1st brought nothing but another crash to $0.06, but as of September 2nd, HBAR bounced back up to $0.63, which is not much, but it shows that the project is willing to grow, given even the slightest opening.

The market sentiment

Fortunately, Hedera is a project that has a greater purpose than simply to pump the price of its token as high as possible, and development continued even during the bearish market. The project has also attracted a lot of attention due to its struggle to grow during the bearish 10 months that we have seen so far.

Its positive performance whenever possible, continuous development, and advanced technology brought it to Coinbase’s attention, and recent reports revealed that the largest exchange in the US is considering listing HBAR. Meanwhile, experts continued to point the way towards Hedera, noting that it is working on building decentralized ecosystems shoulder to shoulder with projects like Avalanche and Big Eyes Coin, both of which are major players in this area.

Some have also speculated whether Hedera’s patents might lead to corporate blockchain adoption and 10x soon, and while this is an interesting idea, it is simply speculation at this point. However, it is encouraging, given the fact that it is positive speculation, which is good news for the project.

What will happen next?

As for what happens next, no one can really tell. Hedera has been giving away bullish signs over the past few weeks, but any progress it has seen towards recovery has been nullified with the arrival of September. Historically speaking, the crypto winter might start weakening soon, leaving the market exhausted and neutral — a state from which it will spend quite a bit of time recovering before the next big bull run comes along.

In the end, all that anyone can do now is speculate and guess, as the crypto industry remains as volatile and as unpredictable as ever, and there is no sure way to say anything with confidence or any kind of guarantee.

To learn more about Solana, visit our Investing in Hedera guide.