Name one event that over 400 million people around the world are eagerly awaiting at this very moment. You guessed it right—it's the imminent crypto bull run. Without a doubt, crypto enthusiasts possess a remarkable degree of patience, yet the expectation for a sustained period of upward price movement in the market is steadily mounting. After all, every bear market has an eventual end date, and we've observed many times that the dynamic realm of cryptocurrencies is full of surprising developments. History tells us that all significant events have their precursors; the big bang did not manifest in a single day, nor did any recessions or world wars. Today, when we reflect on the events that made history, we can discern hints of what led up to those pivotal moments.
The world of crypto is no exception to this rule. While market volatility is inherent, there are potential indicators of an impending bullish run, and triggers can be identified. Whether you embarked on your crypto journey after 2021 and are eagerly awaiting your first taste of a crypto bull run, or you're a seasoned crypto veteran who has weathered the ups and downs, this article aims to guide you through potential triggers for an upcoming bull run and how analysts assess the current market conditions.
What is a bull or bear market?
So, you've gone through the introduction of this article, and you're not quite clear on what we meant by a bull run? No problem; it's quite straightforward. Whether you're involved in traditional markets or the cryptocurrency sphere, a bull market signifies a consistent upward movement in prices over an extended period, accompanied by heightened investor confidence. On the flip side, abrupt downward price shifts can initiate a bear market, where investors anticipate continued price declines and consequently sell off to mitigate potential losses. Markets can demonstrate bearish trends from time to time, and if the fall persists, such a period can be identified as a bear market.
As a relatively recent asset class, cryptocurrencies have encountered both bull and bear markets. The first significant crypto bear market, in 2011, occurred at a time when most current investors were likely unfamiliar with the concept of Bitcoin. This was followed by the 2013 bull run, which resulted in a staggering 750% change in the price of BTC. Perhaps the most recognizable bull run occurred between October 2020 and November 2021, during which Bitcoin underwent a price surge of over 480%. This surge was fueled by a series of macro-events, including the rapid growth of digital payments due to the COVID-19 pandemic, an influx of institutional investments into the crypto space, and the flourishing NFT market.
For many analysts, the cryptocurrency market has been entrenched in perhaps its longest bear run in history since the collapse of FTX and TerraUSD in 2022. But there is no reason for investors to get all pessimistic; on the contrary, 2023 has revealed signs of improvement with the recovery in BTC and the emergence of potentially lucrative projects.
If you’re hoping to profit from the crypto market this year, let’s delve into exploring some of the triggers that could initiate the next crypto bull run so that you can stay alert to potential markers and make better investment decisions.
Next Bitcoin halving
As the pioneering cryptocurrency, Bitcoin exerts an undeniable influence on the entire market. Presently, Bitcoin's price is approximately 40% below its 2021 peak, yet the crypto community is eagerly anticipating a pivotal event known to historically impact its value: the 2024 Bitcoin halving. Bitcoin has a finite supply of 21 million, and this scarcity is a key driver of its value. During a halving event, the reward for mining Bitcoin transactions is halved, effectively curbing inflation and ensuring the asset's scarcity. Throughout history, Bitcoin's price surges have been closely associated with halving events, as rising demand and reduced supply create positive market sentiment. Below, you can examine the BTC price chart, marked with vertical lines representing each halving event, illustrating how prices have soared following these occurrences.
While past patterns do not guarantee future outcomes, it's noteworthy that halving events have consistently preceded bull markets. This track record instills confidence in investors that a bull market is likely just around the corner, possibly coinciding with the next BTC halving. For those wondering when the next Bitcoin halving is, here's a key point to remember: Bitcoin halving occurs approximately every 210,000 blocks, equating to roughly every four years. Based on this recurring cycle, the upcoming BTC halving is estimated to take place in April 2024.
Institutional adoption of crypto assets: Blackrock ETF on the horizon
Bitcoin experienced a notable price surge, surpassing the $30,000 mark, following an announcement by the world's largest asset manager, BlackRock, filing for a spot Bitcoin exchange-traded fund (ETF) through the SEC on June 15th (see the chart below). This development triggered a chain reaction, with other major investment firms like Fidelity and ARK Investment following suit by filing their own applications for spot Bitcoin ETFs. This collective move then generated a wave of excitement and optimism within the market. However, the SEC decided to delay the review of all these ETF applications, with BlackRock's application postponed to October 17th. While it is highly probable that the SEC will defer its decision until the final deadline in 2024, the market is optimistic because, if approved, a spot ETF would enable investors to track the current BTC price rather than relying on futures contracts, offering easier fund trading.
On a larger scale, with access to a colossal capital pool of $30 trillion, BlackRock has the potential to spearhead the mass adoption of Bitcoin and catalyze a seismic shift toward institutional adoption of digital currencies. Analysts foresee that broader acceptance will likely follow, potentially igniting a bull run in the market. With Grayscale scoring a victory in converting its BTC trust into an ETF and the recent announcement of Japan’s Nomura Bank launching a Bitcoin Adoption Fund for institutional investors, the growing interest and adoption of mainstream financial giants can potentially trigger the next bull run in cryptocurrencies.
Expanding Utility
Even during bearish market conditions, digital assets have persisted in their growth and evolution. Coins and tokens have transcended their roles as mere financial instruments, now possessing value in unlocking new use cases and enriching experiences in the upcoming Web 3.0 revolution. An example of this evolution is in the realm of NFTs. Initially flourishing during the last crypto bull run, their value was later heavily scrutinized, leading to a significant decline in demand. However, today NFTs shifted gears to serve various functions such as digital identity authentication, transparent record-keeping, ticketing, and more.
Similarly, decentralized technologies have considerably broadened their use cases, further empowering users. Phemex, for instance, has introduced its groundbreaking Web 3.0 ecosystem in its transition into a hybrid, semi-centralized exchange. At the heart of this revolution lies Phemex Soul Pass, a soulbound token that validates online identities within the Web 3.0 space. In the upcoming bull run, users will have further opportunities to trade and flourish in the online realm while actively participating in the governance of their assets and never compromising on security. As history has shown, each bull market surpasses its predecessors. With the robust developments within the ecosystem, analysts have compelling reasons to believe that the upcoming bull run holds immense potential in terms of value.
Understanding Bitcoin to predict the next bull run
Bitcoin, as the original cryptocurrency with a profound influence on the overall market, serves as a crucial tool for analysts to forecast upcoming bearish and bullish trends. It’s safe to assume that the next bull run will be led by Bitcoin. A detailed examination of how the pioneering token is performing and understanding its market fluctuations can provide traders with valuable insights to maximize their profits.
After a bearish month of August, traders were eager for some positive movement in Bitcoin prices, and it finally arrived as it reached a local high of $27,486. While these gains sparked optimism within the market, pushing the Relative Strength Index up to 61, Bitcoin struggled to surpass the $27,500 resistance. As the new week commenced on September 25th, the price tested $26,094, showing a lack of momentum.
If you've begun the week with a sense of pessimism upon witnessing BTC lose its recently gained momentum, keep in mind that the cryptocurrency market operates 24/7. Bearish or bullish trends can shift rapidly, and what you observe at one moment may transform in the blink of an eye.
Analysts hold differing views on the direction Bitcoin may take this month. Some contend that historical data indicates bearish performance for Bitcoin during the months of September and October due to reduced market liquidity, with October typically showcasing a positive trend. Recently, crypto analyst @Titan of Crypto shared on X that Bitcoin's price action aligns consistently with the Fibonacci retracement level in the months leading up to previous halving events, expecting BTC to rise to $48,700 before the next halving. In contrast, some analysts argue that another potential delay by the SEC in deciding on the Blackrock ETF, combined with low volatility in traditional markets, will keep traders waiting until the halving event for a sustained uptick in prices.
As illustrated, cryptocurrency analysts are carefully evaluating both historical data and macroeconomic conditions that could influence prices. Traders can get valuable insights from seasoned analysts and employ them as tools to optimize their potential gains. However, it's essential to conduct your own research and not rely solely on a single source of information when building your trading strategy.
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