Learn why the cryptocurrency market is gearing up for a potential bull run this fall. Explore key factors, all of which could signal the end of crypto summer and the beginning of a new rally.
As the calendar turns from summer to fall, the cryptocurrency market follows suit, marking the end of a season of volatility and uncertainty. Crypto Summer runs from June 20, 2024 to September 22, 2024, and is characterized by market crashes and short-lived rallies that leave investors looking forward to the future. Historically, the transition from summer to fall has often been a precursor to a bull phase in the cryptocurrency market. Many believe that a strong bull run is in place that could last into 2025 and 2026. Here are five key reasons why crypto summer is over and a new bull run is on the horizon.
5 indicators signal the end of the crypto summer and the beginning of a bull run
Summer is over and fall is here. Historically, a lot of great things happen in the cryptocurrency space, chief among them being bull supercycles. Bitcoin prices surge after each halving, with the majority of returns realized between 12 and 18 months after the halving event. Here are some things to look out for to signal the start of a bull run:
1. Rate cuts
The latest rate cut by the US Federal Open Market Committee (FOMC) has caused a surge in Bitcoin prices. This is the first rate cut in the past four years, sparking optimism that a bull run in cryptocurrencies could be starting. The 50 basis point (bps) rate cut on September 18 was the first of many rate cuts aimed at curbing inflation. Cryptocurrency inflows surged by more than $300 million after the Fed’s rate cut, indicating that this could be the potential start of a market rebound.
2. Fourth quarter (historical data shows a 98% return in the fourth quarter)
Historical data shows that Bitcoin and cryptocurrencies have strong price performance in the fourth quarter of the year. For example, according to Coinglass, the average return in the fourth quarter over the past 12 years is 98%.
This seasonal trend is attributed to investor optimism and increased market activity at the end of the year. If this pattern holds true this year, we could see a significant rally in the cryptocurrency market heading into the fourth quarter.
3. CZ is coming soon
The expected release of Binance founder Changpeng Zhao from prison on September 29 will also be a major catalyst for the market. Zhao is a high-profile and influential figure in the cryptocurrency community, and his leadership of Binance is key to the mass adoption of cryptocurrencies around the world. His release will restore investor confidence, potentially causing cryptocurrency prices to surge and start a bull run.
4. FTX repayment
The repayments from the FTX collapse are another factor that could inject liquidity into the cryptocurrency market. As victims of the FTX collapse recover their funds, they can reinvest those funds in cryptocurrencies. This will drive up demand and prices. The FTX situation is currently up in the air in the market, and its resolution will restore more stability to the market. The company said it has between $14.5 billion and $16.3 billion to distribute to creditors.
5. Elections
The upcoming US election on November 5th could have a crucial impact on the cryptocurrency market. This year’s election has seen the highest cryptocurrency participation in any US presidential election. Historically, both Bitcoin and traditional markets have seen gains after the election. This year’s impact could be more pronounced as both presidential candidates are trying to cater to the crypto masses. However, if Donald Trump wins, there could be a major crypto bull run compared to Kamala Harris.
Conclusion: Is a Crypto Bull Run Coming?
These factors suggest that the summer in the cryptocurrency market is over and a bull run could be imminent. All of these are major market-moving events that could occur between now and the end of the year, with the potential to spark a bull run.
