Since the approval of the Bitcoin spot ETF, the price of Bitcoin has soared, just a step away from the $100,000 mark. However, in this bull market, it has only been 'Bitcoin's solo rise', with Bitcoin's market cap proportion in the cryptocurrency market steadily increasing.

Will the season for altcoins come? Or is the $100,000 Bitcoin already the peak of the bull market? We compared data from the past four years to answer this question.

Basic situation description

Data source

The data involved in this article includes: ① Bitcoin price, ② Bitcoin contract funding rate, ③ Bitcoin contract transaction volume, ④ Bitcoin contract active buy transaction volume, ⑤ Total market capitalization of stablecoins, ⑥ Total market capitalization of cryptocurrencies, ⑦ Total market capitalization of Bitcoin, ⑧ Nasdaq transaction volume, etc.

Where ① contract prices are from Binance, and spot prices are from CoinGecko; data ②-④ are from Binance contracts; data ⑤, ⑥, ⑦ are from CoinGecko and DefiLlama; ⑧ is from Yahoo Finance.

Key points of the chart

This article aims to qualitatively explore the stage of market development rather than quantitatively analyze it. Therefore, to enhance the readability of the charts, the charts used in this article were drawn with Origin, and all data except for the 'stablecoin market value' have been smoothed (parameters set to Savitzky-Golay smoothing, window size 30, 2nd order fitting, with a high degree of smoothing. Readers are advised to focus on trend changes; specific numbers requiring attention will be directly pointed out in the text).

Looking back, what data indicates the arrival of a peak?

Funding rate

Funding rates are undoubtedly one of the most understood and intuitive data for the public. We first reviewed the first wave of the bull market from January to May 2021, and the relationship between Bitcoin funding rates and Bitcoin prices is shown in the figure below:

From this, a very significant pattern can be observed: peak prices coexist with extreme rates, and extreme rates often appear before the price peaks. The three extreme rates occurred in early January, mid-February, and mid-April, corresponding to prices of $40,000, $45,000, and $60,000 respectively.

But at the same time, it should be noted that a high funding rate does not necessarily mean an absolute peak; higher rates are often more pronounced in the early stages of a bull market.

The Bitcoin fee rates and trends from the end of 2023 to April 2024 are shown in the figure below:

It can be seen that the market around 2024 is significantly 'calmer', despite Bitcoin reaching a new historical high; the rate has not broken the 0.1% mark again (the maximum value occurred on March 5, with a price of 66,839 USDT). However, we also see that the rate reached a peak before the price did.

Active buy transaction volume

Here, we selected the active buy transaction amount of Bitcoin contracts on Binance as the research subject, and similarly chose the period from January to May 2021 for analysis. It is also evident that this indicator is a 'lagging indicator' or 'following indicator'.

The peak of active buy transaction volume often lags behind the price peak, and during the decline from the peak, the active buy transaction volume rises faster, indicating that users in 2021 preferred to actively bottom out during declines.

The data from the end of 2023 to April 2024 is shown as follows. Interestingly, this indicator has again become a 'leading indicator'; the active buy transaction volume appears simultaneously or slightly earlier than the price peak, and the volatility is larger and more significant, likely to become an effective reference indicator.

Circulating market value of stablecoins

In the 2021 bull market, the Federal Reserve's unlimited QE and the influx of outside hot money drove Tether to issue USDT wildly, accelerating the bull market. We first reviewed the total market capitalization of USDT and the total market capitalization of cryptocurrencies from 2021 to 2023 as follows:

It can be seen that stablecoins have no correlation with short-term trends; we need to expand the perspective to the annual line level to show slight correlation.

Bitcoin price and the season for altcoins

The Bitcoin price, Bitcoin market value, total market value of altcoins, and market share over the past 4.5 years are shown in the figure below:

In 2020 and 2021, during the first wave of Bitcoin's rise, the market share of altcoins sharply declined, then quietly turned around in early 2021. As Bitcoin rose, the share of altcoins increased.

Returning to the present, Bitcoin has already completed the first and second waves of rises, but the decline in the proportion of altcoins is not rapid, and there are no obvious signs of bottoming and rebounding.

It is difficult to pinpoint the trajectory, but in absolute terms, the two key market shares in the last bull market were 30% at the bottom in early January 2021 and 40% in mid-February 2021, and the current value is 46%, not far from the most recent starting point.

Market activity level

Last week, on-chain analyst @ai_9684 xtpa posted on platform X, stating: 'Since the launch of the GOAT contract on Binance at the end of October, it is obvious that Binance's attitude towards Memecoins has begun to change. Over the past 30 trading days (2024.10.07 – 11.15), Binance's trading volume was 10% higher than that of Nasdaq, 2 times that of the New York Stock Exchange (NYSE), and 16 times that of Coinbase, accounting for about 50% of the global centralized exchange trading volume.

First ask if it is, then ask what - has the market trading volume reached a historical peak? Data review shows that on November 12, the Bitcoin contract trading volume reached the fourth highest record in four years (the top three occurred on March 5, August 5, and February 28, 2024), and the fifth highest was on May 19, 2021.

So does the peak transaction volume mean the market peak? The data from the past four years is shown in the figure below:

It can be seen that only three peaks exceeded $30 billion, and the first two appeared near the peak.

What stage are we in?

In summary, funding rates, active buy transaction volumes, and total transaction volumes are leading indicators of the market. The total transaction volume has issued a warning; what stage are the other two indicators currently in?

The rate is shown as follows; it can be seen that the rate is currently still at a low point, far from March of this year, let alone the frenzied phase of 2021.

The active buy transaction volume is shown in the figure below; this indicator also reached a historical high on November 21.