Is Bitcoin about to enter the peak of this cycle?
On December 24, MarketWatch reported that Bitcoin has been volatile since it broke the $100,000 mark earlier this month. However, analysts at crypto research firm K33 suggest that if history repeats itself, Bitcoin could reach new highs again by mid-January 2025, followed by a peak.
Yesterday, Bitcoin rose by 6.1%, currently priced at $98,048 per coin. On December 17, Bitcoin reached an all-time high of $108,309 per coin but declined after the Fed turned hawkish last week.
Vetle Lunde, head of K33's research department, stated that based on historical data, the average duration from Bitcoin's first all-time high to its last all-time high is 318 days. Since the first historical high of this cycle occurred on March 5, Bitcoin may reach a new high on January 17, 2025.
Generally speaking, cryptocurrency analysts divide Bitcoin's price performance into a four-year cycle—each cycle includes four phases: breakout, hype, correction, and accumulation. The four-year cycle is primarily based on Bitcoin's halving schedule, which controls the supply of Bitcoin through a halving mechanism that occurs approximately every four years, with the most recent halving occurring this April.
If Bitcoin does reach its cycle peak in mid-January, it will be close to Trump's presidential inauguration on January 20. Lunde believes that after Trump takes office, the momentum surrounding Trump trades will taper off, and Bitcoin is one of them.
"Trump's election was a catalyst for Bitcoin's strong rebound in the fourth quarter, and the inauguration may be a natural conclusion to this momentum, as implementing Trump’s policy promises requires a political process."
Lunde stated that based on the peak price estimates from previous Bitcoin cycles, the peak of this cycle could reach $146,000 per coin; if we refer to historical market capitalizations, the highest price in this cycle could reach $212,500 per coin.
However, it should be noted that Bitcoin was launched in 2009, and as an asset, its history is still very short. Additionally, due to the small sample size, Bitcoin's historical price data may not be sufficiently representative, and past performance does not necessarily predict future performance.
Lunde pointed out that, in fact, as the halving effect diminishes, Bitcoin's cyclical effects are also becoming less pronounced.
Currently, as the end of the year approaches, enthusiasm in the cryptocurrency market seems to be cooling off. As of Monday, Bitcoin ETFs have seen outflows for three consecutive days.
Additionally, despite MSTR announcing on Monday that it had purchased 5,262 Bitcoins again at about $106,662 per coin, analysts at crypto trading firm QCP Capital pointed out: 'This is the smallest purchase amount for MSTR in recent times, raising doubts about whether MSTR's buying interest has weakened at this price level.'