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Is Bitcoin On The Verge Of a replacement Bull Run?

After a few of cold winters with wild fluctuations on the upper end lower end of the spectrum, Bitcoin’s price is finally stabilizing.
The cryptocurrency has been hovering between $8000-$10000 for quite a year already, with the exception of the unfortunate “crash” caused by the news of COVID-19.


When watching historical events, Bitcoin seems to possess a high probability to enter a replacement bull-run. Some may argue that we are already into one ever since the newest lows of 2018, but it might be more appropriate to mention that we are still recovering. The majority of investors are still at loss.

In this article, we’ll take a glance at some interesting data points that indicate Bitcoin’s future trajectory. So keep it up reading to urge a far better idea of where we are headed.

Post halving sentiment

On May 11, 2020 bitcoin blockchain experienced its third halving. Essentially, all miners will now be receiving just half the rewards they were receiving for the past few years. And that is big news!
For the other asset, this sort of stories would bring an enormous inflow of investors. Imagine if half the oil tanks worldwide would dry up – the worth of oil would skyrocket.

The same is not necessarily true with Bitcoin. With cryptocurrency, all that matters is the demand. And we are currently still at a phase where people are hesitant to take a position .

But let’s have a look at historical patterns. How did Bitcoin react after its previous halvings?
What we’ll notice from the image above is that there are certain timeframes where demand builds up. In the case of Bitcoin, it takes on the average 1 year from the time of the halving to ascertain a replacement all-time high. We are currently one month post-halving so we should always hopefully see some price swings happening soon.

Historically, after the worth surge occurs, Bitcoin tends to enter during a market phase. In the last phase, rock bottom we saw Bitcoin drop during its market was $3200, which occurred within the first days of January 2019. Knowing this may also assist you prepare an idea of action right after the market has concluded.

 

The S2FX model

One of the foremost interesting price prediction models of the past year belongs to Twitter user @1trillionUSD. The Dutch securities analyst who prefers to stay his identity hidden created a Stock-to-Flow model specifically for Bitcoin, to live its scarcity.

The model compares Bitcoin’s reserves with the annual production to urge a far better understanding of where the worth is headed to.
According to this S2FX model, we could see Bitcoin peak anywhere between $56000 and $28900. However, the author takes an objective viewpoint and does inform the readers that he’s prepared to be proven wrong also .

To read more and understand how this model works have a glance at his article. Then, confirm to also read the updated version of the model (S2FX) where he removes the timeframes and easily compares the worth with other assets (gold and silver).

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Coin Value / Moving Ratio

A less known data metric provided by analytics company Glassnode suggests that Bitcoin is on the sting of starting a replacement Bull Run .
The data metric calculates the half of of Bitcoin that features a higher value immediately compared to when it had been last moved.
In short, quite 16 million Bitcoin of the present circulating supply is seeing price increases. That is 87% of the 18,4 million BTC that are mined.

You might argue that a lot of of these coins simply come from lost or inaccessible wallets which would be a legitimate concern. We have to remember that lost coins were also taken into consideration during previous data collections.
This 87% is extremely almost like the amount that pre-exceeded the previous bull runs. Glassnode mentioned that when quite 90% of the coins are appreciating in value we’ve a transparent signal of a market .

One big case we saw that the ratio surpass 90% during October of 2016. It was during that point when Bitcoin went from its $470 lows in August to $1,100 within the first months of the subsequent year.

The price rally continued as Bitcoin eventually reached its peak on the brink of $20.000 in December of an equivalent year. Throughout all this point , the info indicates that 80-99% of coins appreciated in value since it had been last moved.

We can see same patterns as well when looking further back in time. In January 2013, the availability in profit crossed 90% and stayed there for nearly 100 days. During this point , Bitcoin reached a price of $250 (by mid-April).

Similar pattern was seen later in 2013 when Bitcoin reached $1000. So, once more, if history is any indication for the future, we could see a massive bullrun of this cryptocurrency as soon as the percentage of supply in green increases to 90%+ levels.

More transparent markets

Apart from data and predictions, it’s important to also check out the space as an entire . Since the newest bull-run, ICO’s have almost completely perished, and buying Bitcoin has become tons easier than before. Investing in cryptocurrency is not any longer reserved for the tech-obsessed.

According to Bitwise’s report for the SEC, quite 95% of exchanges were reporting fake volumes which is a very interesting news to observe!
In their effort to maximise their profits, they delivered a serious hit to the transparency of the crypto markets as an entire .

Thankfully, since the recent acquisition of CMC by Binance, the info provider is now more transparent than ever before. All this results in a more regulated and mature market that’s ready to handle the rise in demand. All we will do immediately is wait and twiddling my thumbs . History may convince us, once again, that Bitcoin features a lot left in its tank.

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