Bitcoin Market Cycles: What History Reveals About BTC’s Future Path

• Bitcoin surged over 40% in November and reached a new all-time high, aligning with previous market cycles.
• Long-term holders have started taking profits, while institutional investors increase their participation through ETF inflows.

Bitcoin experienced a significant price surge in November, increasing by over 40% and achieving a new all-time high on November 22. This performance aligns closely with trends observed in previous market cycles, particularly the 2015-2018 and 2018-2022 cycles.

In both of these cycles, the price of Bitcoin spiked with an appreciation of 480% and 590%, respectively, at similar times. The current cycle has a remarkable rise of 560%. However, there was a considerable difference in the 2011-2015 cycle, where the growth rate was 29,200% because of the early-stage market and higher volatility.

Although the returns have been decreasing in each successive cycle, the length of each cycle has been constant. If the present trend prevails, Bitcoin may appreciate until the end of 2025 and hit $168,000 with a 1,000% rise from the cycle low.

Analysts Predict Bullish Continuation With Potential Corrections

Crypto analyst Ali Martinez has projected a possible peak of $138,000 in this cycle, though he warns of a sharp correction afterwards. Martinez highlighted Bitcoin’s tendency to follow historical patterns in bull market cycles. In 2017, Bitcoin surged 156% past its previous all-time high before a 39% correction. Similarly, during the 2020 bull run, Bitcoin gained 121% and later declined by 32%.

Comparing these trends, Martinez supposes that the current cycle of Bitcoin may repeat the same path. The cryptocurrency has broken through previous record highs and continues to trade above $90,000. According to Martinez’s projections, there is room for the price to climb to $138,000 before a bear market finally sets in. “If history repeats itself, $BTC could go as high as $138,000 before experiencing the first dip,” Martinez revealed on X.

Long-Term Holders Begin Profit-Taking

According to on-chain metrics, long-term holders (LTHs) have started to book profits after recent price achievements by Bitcoin. The Net Unrealized Profit or Loss (NUPL) of long-term holders has been gradually on the rise since September. However, it has not reached the ‘euphoria’ stage that has been linked with the apex of a market cycle.

Another metric that indicates market behaviour is the Market Value to Realized Value (MVRV), which also demonstrates the behaviour characteristic of transitional market phases. High MVRV ratios coupled with increased spending by LTHs were a feature of the previous cycles. These conditions were seen during Bitcoin’s local top in March 2024 and are back again after the recent all-time high.

While the long-term holders are offloading, institutional investors seem to be on the buy-side as seen from the inflows in the ETFs. This implies that market activity is moving away from the retail and whales to more prominent investors.

According to historical data from previous cycles, major rallies by longevity investors are often followed by the most vigorous price gains of Bitcoin. These phases can take a few months before a market peak.

FOMO Drives Market Sentiment

Data from social media sites such as X, Reddit, and Telegram shows increased conversations regarding Bitcoin crossing the $100,000 mark. Santiment noted that FOMO sentiment is on the rise, and the discussions about Bitcoin reaching $100K are at an all-time high.

According to Google Trends, retail interest in Bitcoin has risen to its highest level in over a year, indicating more adoption. A score of 100 shows that retail traders are euphoric, complementing the increasing speculation about Bitcoin’s next direction.