Exploring the Potential of the Current Crypto Bull Market Cycle

Bitcoin has entered its seventh bull market cycle, according to the head of Pantera Capital, Dan Morehead.[0] The firm, which manages a number of cryptocurrency hedge funds, has been through ten years of Bitcoin cycles – and Morehead has traded through 35 years of similar cycles. He believes that blockchain assets have seen the lows and that we’re in the next bull market cycle, regardless of what happens in the interest-rate-sensitive asset classes.[1]

The decline from November 2021 to November 2022 was the median of the typical cycle, but this particular bear market was the only one to more than completely wipe out the previous bull market gains, giving back 136% of the previous rally.[2] The median length of drawdown was 307 days, while the previous bear market was 376 days in duration.[3] The median decline is -73% and the latest bear market ended at -77%.[2]

Bloomberg’s senior macroeconomic analyst Mike McGlone suggests that those who buy and hold are more likely to benefit, as opposed to those who speculate and leverage.[4] He believes that more regulations may be coming to the industry in the near future, as there’s “so much adult supervision needed in crypto,” even though “people complain about regulation.”[5]

McGlone further expands on his outlook on the current state of the crypto industry, noting that if the U.S. Fed continues to tighten policy despite the risk of recession, then rising financial markets, and particularly the riskier crypto-currencies, will face a headwind.[6]

Meanwhile, economist and trader Alex Krüger claims that Ethereum (ETH) and Bitcoin (BTC) may have additional downside potential but that a fresh crypto rally is close at hand.[7] The Federal Reserve’s Consumer Price Index (CPI) report, which tracks the rate of change in US inflation over time, is slated for release on February 14th.[8] A Consumer Price Index that is lower than anticipated is usually interpreted as a positive sign, as it could prompt the Federal Reserve to consider halting its rapid interest rate increases.[7]

0. “Bitcoin Price Prediction as Pantera Capital CEO Says Next Bull Market Cycle Has Already Started – What Does He …” Cryptonews, 12 Feb. 2023, https://cryptonews.com/news/bitcoin-price-prediction-as-pantera-capital-ceo-says-next-bull-market-cycle-already-started-what-does-he-know.htm

1. “Investment Gurus Predict Next Bull Market For Cryptocurrencies” Benzinga, 10 Feb. 2023, https://www.benzinga.com/markets/cryptocurrency/23/02/30857226/investment-gurus-predict-next-bull-market-for-cryptocurrencies

2. “Is Bitcoin Entering Into A New Bull Run? Pantera Capital Weighs In” NewsBTC, 14 Feb. 2023, https://www.newsbtc.com/news/bitcoin/is-bitcoin-entering-into-a-new-bull-run-pantera-capital-weighs-in

3. “$4,100,000,000 Crypto Fund Says Bear Market Over, New Bull Run on Regardless of Interest Rates” The Daily Hodl, 14 Feb. 2023, https://dailyhodl.com/2023/02/14/4100000000-crypto-fund-says-bear-market-over-new-bull-run-on-regardless-of-interest-rates/

4. “This Strategy May Benefit Current Crypto Market, Bloomberg’s Senior Strategist Says” U.Today, 14 Feb. 2023, https://u.today/this-strategy-may-benefit-current-crypto-market-bloombergs-senior-strategist-says

5. “Bitcoin ($BTC) Maintains ‘Downward’ Trajectory as Interest Rates Keep Rising: Bloomberg Analyst” CryptoGlobe, 13 Feb. 2023, https://www.cryptoglobe.com/latest/2023/02/bitcoin-btc-maintains-downward-trajectory-as-interest-rates-keep-rising-bloomberg-analyst/

6. “Bloomberg reveals this strategy to maximize your gains in the crypto-currency market” Royals Blue, 14 Feb. 2023, https://www.royalsblue.com/bloomberg-reveals-this-strategy-to-maximize-your-gains-in-the-crypto-currency-market

7. “Economist Issues Warning Ahead of CPI Report on 14 February–Bitcoin and Ethereum in Trouble?” Coinpedia Fintech News, 12 Feb. 2023, https://coinpedia.org/news/economist-issues-warning-ahead-of-cpi-report-on-14-february-bitcoin-and-ethereum-in-trouble/

8. “Economist Alex Krüger Issues Bitcoin and Ethereum Warning, Predicts When Next Crypto Rally Will Begin” The Daily Hodl, 11 Feb. 2023, https://dailyhodl.com/2023/02/11/economist-alex-kruger-issues-bitcoin-and-ethereum-warning-predicts-when-next-crypto-rally-will-begin/