Cryptocurrencies have had a tough year, with a crypto winter that has extended well past 2021. Prices have fallen significantly, trading volume has cratered and several high-profile projects collapsed in liquidity crises. In addition, China has been cracking down on the crypto market, leading to more volatility in the markets and even a halt in new issuance.
But just as spring will come after the coldest winter, the next crypto bull run will follow this current crypto winter. When it does, it will be an opportunity for investors to get in on the action and ride the wave of gains that are likely to come.
What is a Bull Run?
A bull run is an upward trend in which the prices of assets, typically stocks and cryptocurrencies, rise. A bull run is generally accompanied by periods of consolidation. A bull run usually occurs after a period of consolidation, but may last longer or shorter than expected.
When Does a Crypto Bull Run Start?
A crypto bull run starts when the price of a particular asset begins to rise, usually by more than 20%, from its low. Oftentimes, a bull run is triggered by a technological breakthrough, a change in the monetary policy of a country, or a natural disaster that leads to a rush of investment in cryptocurrencies.
Why Is a Bull Run Likely?
A bull run in the crypto space may be triggered by a halving rally, whereby miners sell half of their Bitcoin rewards. Historically, halving rallies have occurred every four years, and they have consistently been the starting point for bull runs.
If the next crypto bull run is triggered by a halving rally, it could be possible for prices to go much higher than they have in recent years. However, this would only be true if demand for a particular cryptocurrency surged.
What Are the Key Indicators of a Bull Run?
A bull run usually starts when the price of an asset reaches a certain level, and it can be difficult to determine the exact moment that it will begin. This is because markets are constantly moving in cycles, and the time it takes for a bull run to occur can be unpredictable.
The best way to predict a crypto bull run is to look at the past. Looking at previous bull and bear runs in the market can help you identify potential trends, which will give you a better idea of how long a crypto bull run will take.
While a crypto bull run is likely, it’s important to be aware that it can take several years before prices reach their peak levels. This is because the price of a crypto asset can fluctuate quickly and unpredictably. So, it’s important to have a good understanding of the cyclical nature of the crypto market before you decide to enter the crypto market as an investor.