How this Bitcoin bull market tracks to other major price rallies

This would be Bitcoin’s fifth bull market ever, with market cycles historically lasting years

article-image

Things/Shutterstock modified by Blockworks

share

Bitcoin has pressed on with its price rally, and if you believe traditional market math, another bull run has long been confirmed.

The price of BTC briefly cleared $42,000 Monday morning — up nearly one-fifth over the past month and by 150% over the year to date, about on par with Meta but trailing Nvidia.

Bitcoin is now at levels not seen since about a month before Terra collapsed in May 2022, pulling crypto into its longest bear market in history by at least one metric.

Potential approval for spot bitcoin ETFs from banks like BlackRock and Fidelity may have pushed bitcoin higher. The DOJ finalizing its case against Binance and co-founder Changpeng Zhao also appear to have helped, with markets no longer wondering about the worst case scenario.

While not an exact science, standard definitions say that bull markets are confirmed when an asset climbs 20% from recent lows, and bear markets demand a 20% drop from prior highs. 

The S&P 500, for example, confirmed in June that it had been in a bull market since lows of October 2022.

The log view better compares bull market returns

Because crypto is typically more volatile than stocks or real estate — sometimes swinging 20% either way in a matter of days — it’s probably more realistic to confirm bull and bear markets over a longer period of time.

So, let’s say a crypto bear market starts when a token stays 20% below its most recent high for two months or more. And a bull market begins when it climbs that much above its latest lows and stays there for one month or more.

  • That would mean bitcoin has been in a bull market, its fifth ever, for the past 296 days.
  • On January 12, 2023, Bitcoin first traded 20% above lows set just before FTX declared bankruptcy last November.
  • Bitcoin held onto those gains for one month to start the bull market on February 12, 2023.

Napkin math like this is fun, but it should be stressed that bitcoin, like all other cryptocurrencies, is an incredibly young asset. 

With only around 13 years of price history, it’s somewhat silly to expect any real insight from studying its past performance, whether it’s about bull markets or the impact of halvings.

Still, plotting out bitcoin’s bull run so far against its previous major rallies shows some correlation: its returns match the previous two runs almost exactly: 170% compared to 165% in 2020 and 140% in late 2015.

Those rallies topped out years later up thousands of percent, although this time might pale in comparison as bull run returns have diminished every cycle. 

Bull markets also don’t go in a straight line, with price corrections between 30% and 50% common across cycles even in multi-month uptrends.

In any case, the last two bull markets lasted more than two and a half years each — so it could be early days if the bull is truly back.


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

Mon - Wed, March 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience: Attend expert-led panel discussions and fireside chats Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts.

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Top Icon.png

Research

Osmosis thrived in H2 2023 on the back of increased DeFi activity deriving from recently launched Cosmos-related projects and better market conditions. With new value accrual mechanisms for the native token, Osmosis is well-positioned to continue its strong performance in 2024.

/

article-image

Though the opposing flow trend is likely to slow over time, industry watchers note, bitcoin fund assets could one day eclipse the $90 billion gold ETF space

article-image

Celestia had the first mover advantage. EigenDA has staked ether. What sets Avail apart?

article-image

Bitcoin moved 1% higher Monday morning in New York, Matrixport analysts say $62,000 could happen next month

article-image

It’s hard to believe right now that crypto — even with all of its flexibility and massive capabilities — could ever be like cash on the internet

article-image

Michael Saylor announced Monday morning that MicroStrategy bought 3k more bitcoin after the X account was compromised over the weekend

article-image

Plus, Pudgy Penguins grows its brand and a group of Autoglyphs sell for $14.5 million