DON'T PANIC! DON'T SELL YOUR CRYPTO UNTIL 2025, BUY MORE INSTEAD . HERE IS WHY:
Caleb & Brown (2024), a cryptocurrency brokerage, conducted a detailed analysis of the Bitcoin market cycle from 2012, the year of Bitcoin's first halving, to 2024. They identified four distinct phases in the Bitcoin cycle:
1. Accumulation: Prices are low with early growth signs. Savvy buyers accumulate Bitcoin. Volume is low, and prices fluctuate within a tight range.
2. Growth: Prices rise towards the all-time high. Halving events and increased buying reduce exchange reserves, pushing prices up.
3. Bubble: Prices exceed the previous all-time high and rise sharply. Volatility increases, with rapid price increases and corrections. Investors begin selling to lock in profits.
4. Crash: Following the bubble, a significant correction occurs. Prices drop substantially, often by around 80%, with negative price action lasting about a year.
Their analysis revealed a cyclical pattern in Bitcoinโs price behavior:
- From 2012 (halving year) to 2014, the market saw growth and accumulation, followed by an 87% decline.
- Accumulation resumed in 2015, leading to growth in 2016 (halving year) and a bull run (bubble) in 2017, followed by a crash in 2018.
- The market experienced another accumulation phase in 2019, growth in 2020, a bull run in 2021, and a crash in 2022.
- Accumulation and growth phases were observed again in 2023 and 2024, suggesting that if the cycle continues, a bull run (bubble) is expected in 2025.
The chart below illustrates Bitcoin's cyclical price nature.
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