According to a report from Caixin on December 30 (Editor Liu Rui), cryptocurrency has undoubtedly been one of the 'hottest' investment categories this year: CoinMarketCap data shows that the total market capitalization of cryptocurrencies rose from $1.65 trillion at the beginning of the year to $3.7 trillion, with Bitcoin's price soaring from $37,700 last December to a historic high of $106,000.
However, if history is any guide, Bitcoin may peak in the next two to three weeks, meaning that Bitcoin bulls may need to act quickly to lock in profits.
Will Bitcoin peak in two weeks?
According to data from research firm K33, Bitcoin will reach a historic high in mid-January, just before the inauguration of U.S. President-elect Trump.
K33's statistical analysis shows that, on average, there are 318 days between the first peak and the last peak of a cryptocurrency cycle. The initial peak of the current cycle occurred on March 5 of this year, indicating that the last peak of the current cycle may occur on January 17 next year. This date coincidentally falls close to Trump's inauguration on January 20.
In fact, Trump's victory in the election is precisely the catalyst for Bitcoin's surge at the end of this year. As the 'most pro-crypto president in history,' Trump has made several promises favorable to Bitcoin—such as incorporating Bitcoin into the national reserve—which have all contributed to Bitcoin's price breaking the six-figure milestone for the first time.
However, K33 points out that as the actual time for Trump to take office approaches, cryptocurrency investors are likely to find their hopes dashed:
"The market is highly likely to have unrealistic expectations about the speed of policy changes and overestimate the impact of the inauguration… We expect the current (Bitcoin) rally to peak before Trump's inauguration in mid-January, and consider this area a natural zone for reducing risk and realizing short-term profits," wrote K33 research director Vetle Lunde in a report in December.
Other analyses show similar results.
Another technical analyst familiar with Bitcoin's historical cycles, Adrian Zduńczyk, shares a similar viewpoint. He previously warned that investors should prepare for Bitcoin's upcoming pullback. He expects the price adjustment to begin between late January and February, ranging from 15% to 30%, before potentially entering another bull market.
Meanwhile, another study by data analysis firm CCData this month also indicates that Bitcoin's price will peak next year, although their predicted timing for the pullback varies. According to the company, Bitcoin typically peaks 371 to 546 days after the most recent 'halving' event, with the last 'halving' occurring in April of this year.
The company stated: "This estimate provides two scenarios: one is the baseline scenario, predicting that Bitcoin will peak in early Q2 next year; the other is the bull market scenario, predicting that the asset's highest price will peak in November next year."
The market still lacks bullishness.
However, regardless of the outcome in January next year, there remains a large number of individuals in the market who are optimistic about the trend of cryptocurrencies next year, with predictions for Bitcoin's year-end price ranging from $200,000 to $500,000, supported by ongoing institutional adoption, loose regulation and macroeconomic background, as well as a broad rebound across the cryptocurrency sector.
Even CCData, which warns that Bitcoin may pull back, states that under fundamental conditions, they predict Bitcoin could reach $155,000. In a bull market, Bitcoin could touch $195,000.
K33 also acknowledges that as Bitcoin's market capitalization grows larger, the so-called 'four-year price cycle' may gradually lose relevance.
"The relative impact of the halving is becoming less significant, as Bitcoin is being adopted at the institutional level. Although the bubble and decline of Bitcoin will still be a common feature, they emerge from new developments," said K33.