Bitcoin has not yet peaked in its current cycle. The CCData report on CNBC shows that Bitcoin will surpass its all-time peak this year.
Bitcoin rose to an all-time high of over $73,700 in March. However, it has since traded in a range of $59,000 to $72,000.
Bitcoin's journey to the top, which reached record highs in March, was largely driven by the approval and launch of spot Bitcoin exchange-traded funds (ETFs) in the United States. These funds have attracted net investor inflows of approximately $14.41 billion to date, according to CCData.
ETFs allow investors to track Bitcoin prices and purchase products without owning an underlying cryptocurrency. Crypto bulls say these funds help legitimize crypto and make it easier for larger institutional investors to enter the market.
The Bitcoin 'cycle' refers to the cryptocurrency reaching a new record high before returning to a bear market, or 'crypto winter'. Since the launch of Bitcoin, this cycle has been completed three times. CCData data shows that a similar pattern is happening now.
The cycle in question develops around a rule called halving, in which returns for crypto miners are halved and the supply of Bitcoin in the market is reduced.
The halving usually occurs a few months before Bitcoin cycles reach its all-time high. However, CCData data indicates that the current cycle is different. Because Bitcoin reached its last record before the halving due to the rise around ETFs in the USA.
While Bitcoin trading is at an all-time high, many have questioned whether the cryptocurrency has reached the peak of the current cycle.
CCData's report examining historical Bitcoin price movements suggests that a new peak may be reached. The data and research firm notes that historical trends indicate that the halving event is always followed by a period of price expansion that can last between 366 days and 548 days. The research firm pointed out that each halving reaches its peak with a longer cycle than the previous one, as the asset class matures and volatility decreases.
The last Bitcoin halving took place on April 19 of this year. So, historically, the time period is not over yet.
"We also observed a decline in trading activity on central exchanges for approximately two months following the halving event in previous cycles, which seems to have affected this cycle. The current chart suggests that the current cycle may expand further into 2025," the CCData report stated.
In the company's report, attention was drawn to the US approval of the Ethereum ETF and the expectations for the launch of some other crypto investment products in the world. The report stated that such developments would “bring capital, liquidity and demand” in addition to the asset class.
CCData highlighted another important historical data point to support his thesis, saying that Bitcoin's price increase occurred in a very short period of time. For example, in the 2012 cycle, 91.4% of Bitcoin's total price expansion from halving to record high. The time between the peak and the halving was four months. In the 2016 and 2020 cycles, the peak of the cycle was reached four months later, with increases of 78.8% and 71.5%, respectively.
“Such a parabolic expansion has not yet occurred in the current cycle,” CCData warns.
Other commentators pointed out how Bitcoin's historical patterns have evolved.
“Historically, market cycles peak 12 to 18 months after the Bitcoin halving,” said Thomas Perfumo, Head of Strategy at cryptocurrency exchange Kraken. “The most recent bitcoin halving occurred in April of this year. We also have not seen volatility reach previous peak levels. Finally, “The previous market cycle highs coincided with a rapid succession of all-time highs, with 10 to 20 new highs set in a 30-day window. We have not yet triggered any of these signals.”
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