The Bitcoin (BTC) boom is likely to come in late 2024 or early 2025. This is what Du Jun, co-founder of the once largest Chinese cryptocurrency exchange Huobi, says. His opinion is based on past price cycles combined with cryptocurrency halving.
Bitcoin's last halving - the third in coin history - occurred in May 2020. Then, in November 2021, the coin rose to a record level - nearly $70,000. During an earlier halving in July 2016, BTC soared, hitting an all-time record of over $19,000 at the end of 2017. In early 2024, there will be a fourth Bitcoin halving, after which market participants will wait for the next bull market.
Read also: Peter Schiff Says Bitcoin Will Collapse After Halving
It's worth noting that BTC has fallen every time it hit these record highs. But the cryptocurrency also records "catch up" by drawing a graph that shows an overall parabolic rise in value. Bitcoin has dropped almost 40 percent from its November peak and is currently trading at $39,296. At the end of January, even worse levels were recorded, reaching as much as $33,000.
“If this cycle continues, we should be in the early stages of a bear market now,” he added. “It is very difficult to give an accurate forecast because many factors can influence the market, such as geopolitical issues, including war, or as was the case with the recent pandemic.”
There is some truth to Du's statements, as evidenced by recent market events. Last year, many market analysts projected a $100,000 close for Bitcoin. Among them was the legendary PlanB, the Stock-to-Flow (S2F) model which proved to be largely successful.
However, the S2F and other analyst models have shown to have a critical weakness - not being linked to current and upcoming world events that affect both traditional and cryptocurrency markets.
For example, at the end of last year, market participants began to fear investment due to concerns about interest rate hikes. The pandemic has done its damage by reducing cash flow and thus the money retailers and institutions spend on investments.
Additionally, the political crisis between Russia and Ukraine remains unresolved. Russia says it has withdrawn its troops from Ukraine's borders, but the US remains skeptical. In Canada, there are also protests of the Freedom Convoy, in which citizens demand, inter alia, softer covid-19 regulations.
Following this cycle, it is only at the end of 2024 or early 2025 that we will be able to welcome another bull market on bitcoin, Du noted.
Some market participants are already saying that cryptocurrency winter is inevitable. Others, in turn, believe that it has already begun.
Bitcoin is trading at around $37,000 at press time, 49% below its all-time high, despite bouncing some ground from its January lows.
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