
Bitcoin remains in the red year-over-year. VSthis long crossing of the desert however, bodes well for a symmetrical bull market.
Bitcoin Bear Market
This bear market is relatively comparable to what we experienced in 2015. Sluggish volatility and 62% down from the 2021 all-time high around $70,000.
The graph below shows the annual performance of bitcoin which remains in the red compared to a year ago:
But trust does not erode. The largest investment funds are jostling at the gate to launch an ETF. An avalanche of investment from institutional investors is written in advance once the SEC has given its sesame.
In addition, the hashrate chained the highest historical. It averaged 377 p.e. over the past 90 days. In other words, professionals in the sector remain very optimistic.
And how could it be otherwise when we see that inflation is about to rise again. We are already seeing hyperinflations in big countries like Turkey and Argentina. Inflation there exceeds 100% and bitcoin is already breaking records.
The return of inflation
The price hike will get worse. The reason: the reduction in Saudi and Russian oil production. With naphtha supplying 95% of world transport, this will result in a resurgence of generalized inflation.
Not to mention the tensions over Ukrainian wheat exports. India has already placed an embargo on its rice exports to guard against possible food shortages.
Let’s not forget either that the halving is fast approaching. A Bitcoin ETF cleared shortly before the halving would be a powerful bullish catalyst.
Knowing that the rise should be more resilient this time. The next bull run could prove to be much more persistent than that of 2021. The reason being that 2021 was a highly speculative rise boosted by leverage, whereas institutional funds are more used to playing the long term.
Investment funds need to spruce up starving returns that have been going on for some time. The stock market and the debt no longer pay. And despite Powell’s grand declarations, rates will eventually come down, probably sooner than you think.
Goldman Sachs, for example, expects the FED to raise its rates next June. He murmur even that the QT will end earlier than expected:
The Treasury has issued a staggering $1 trillion of treasury bills in the past three months. And another $600 billion is expected by the end of 2023.”
While waiting for the FED to print again to pay off the gargantuan debt of the US government, bitcoin is chomping at the bit. Some OGs like Adam Back are betting that we will cross $100,000 before the May 2024 halving…
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