The Possibility of a New Bitcoin Bull Run
There is speculation that a new major Bitcoin bull run may have already begun. While there has already been a mini-bull run with an 87% increase in price since October 2023, some believe that the current surge could lead to a return near the all-time highs of $70,000. Calls for prices ranging from $65,000 to $75,000 have appeared on the crypto derivatives exchange Deribit. Open interest around the current $50,000 level suggests that many investors have a bullish view on BTC. However, the upcoming Bitcoin halving in mid-April could potentially mark the end of this mini-bull run.
The April Halving and Potential Price Movements
Two important factors should be considered alongside the possibility of a bull run. Firstly, the price trend of Bitcoin in early 2024 resembles that of early 2021 when the peak was reached in April at $64,000. Secondly, anticipation of the halving could be driving capital inflows into ETFs. Once the halving occurs, these inflows may decrease and trigger a correction in price. Therefore, there may be a period of further growth until April followed by a phase of correction or retracement until June.
The Bearish Hypothesis and Demand for Bitcoin
On the other hand, some believe that reaching the psychological threshold of $50,000 could lead to sales as investors aim to capitalize on their profits. The demand for Bitcoin from ETFs is currently higher than the rate of new BTC creation through mining, and this gap is expected to widen with the halving. Michael Saylor suggests that there is pent-up demand from ETFs that could last for ten years. However, it’s important to note that historically major bull runs have occurred in the year following the halving, raising questions about the current situation.
Bitcoin’s Unprecedented Situation
Bitcoin is in an unprecedented situation due to the introduction of BTC spot ETFs in the US. This could potentially disrupt the historical dynamics of previous halvings and create a new narrative for Bitcoin’s future. It should be remembered that the launch of gold ETFs in the US financial markets led to a prolonged bull run. Ultimately, whether a new major bull run is underway or if this is a speculative mini-bubble remains uncertain, but Bitcoin’s unique circumstances set it apart from previous patterns.
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