I recently revisited the history of economic crises and realized why it’s so important to understand what happened at the end of the 1920s. The Great Depression is not just a historical fact; it’s a lesson about how quickly even seemingly stable systems can collapse.

It all started with the stock market crash in October 1929. Do you remember how people called it Black Tuesday? Before that, speculation on the stock exchange had reached such a level that assets were clearly overvalued. When investors lost confidence, prices started falling like snow in March. Millions of people, many of whom had taken out loans to invest, lost all their savings in a single day. That was the first wave of panic.

Then it got even worse. When people realized their money had disappeared, they rushed to banks to withdraw remaining funds. Banks closed one after another. Without any deposit insurance mechanisms, people literally lost everything. This created a vicious cycle — people stopped spending money, demand fell, companies began shutting down, unemployment rose, and even more panic ensued. The Great Depression turned into a global crisis.

The problem quickly spread beyond the United States. European countries, already weakened by war, faced a collapse in markets for their exports. Governments introduced tariffs like the Smoot-Hawley Act, trying to protect their local industries, but this only provoked retaliatory measures from other countries. Global trade plummeted into an abyss. Everywhere, the picture was the same — businesses closed, breadlines formed, unemployment reached 25% in some countries.

The way out of this nightmare was long. Franklin Roosevelt launched his New Deal — large-scale public works programs, job creation, banking reforms. Many countries implemented social insurance systems, pension schemes. Then World War II began, and governments started actively investing in production — giving the economy a boost.

What do I find particularly interesting in this story? The Great Depression showed that the economy is much more fragile than it seems. Speculation, panic, lack of regulation — all of this can lead to catastrophe. This is directly relevant to crypto markets. We see similar cycles of speculation, panic during crashes, people losing their savings. The difference is that we must learn from historical mistakes. Regulation, insurance mechanisms, caution — these are what helped the world recover after the Great Depression. Maybe we should remember these lessons when we see another bull market and waves of speculation in crypto assets.