According to the co-founder of Huobi, one of the world’s biggest cryptocurrency exchanges, Bitcoin may not go through a bull market until in late 2024 or early 2025, The estimation is based on previous price cycles of the cryptocurrency.
Bitcoin bull markets, according to Du Jun, are intimately linked to a process known as halving, which occurs every few years.
This refers to the bitcoin network’s so-called miners, who use powerful specialized computers to solve complicated mathematical riddles in order to validate transactions. As a result, miners get paid in bitcoin.
Halving is a feature of bitcoin’s underlying code that reduces the reward given to “miners” for validating transactions on the cryptocurrency’s network by half. It happens every four years or so.
The most recent halving of the c cryptocurrency occurred in May 2020, and bitcoin reached an all-time high of over $68,000 in 2021. When the halving was implemented in 2016, a similar situation occurred. The following year, bitcoin reached a new high, which was a record at the time.
Bitcoin fell after both of these peaks. Bitcoin is currently trading about 40% below its November high, however, it is still much above some of January’s lows. The next halving will take place in 2024.
“If this circle continues, we are now at the early stage of a bear market,” Du said, according to a translation of his comments in Mandarin.
“It is really hard to predict exactly because there are so many other factors which can affect the market as well — such as geopolitical issues including war, or recent Covid, also affect the market,” he said.
“Following this cycle, it won’t be until the end of 2024 to the beginning of 2025 that we can welcome the next bull market on bitcoin.”
Some market players are concerned that a so-called “crypto winter,” or a protracted period of bearishness, is on the horizon as a result of the recent price decrease in cryptocurrencies. Bitcoin may trade in a sideways pattern during such periods.
(Adapted from CNBC.com)