When did the fifth Bitcoin bull run begin?

The price of Bitcoin continues to rise, and if you believe in traditional market mathematics, then another bull run has long been confirmed.

On Monday morning, BTC’s price briefly topped $42,000 — up nearly a fifth in the past month and 150% so far this year, on par with Meta but behind Nvidia.

Bitcoin is currently trading at levels not seen since a month before the Terra crash in May 2022, dragging the cryptocurrency into the longest bear market in history by at least one metric.

The possibility that banks such as BlackRock and Fidelity will approve spot Bitcoin ETFs could boost Bitcoin prices. The final completion of the U.S. Department of Justice's case against Binance and co-founder Changpeng Zhao also seems to have helped, with the market no longer fearing the worst.

While it’s not an exact science, the standard definition says a bull market is confirmed when an asset rises 20% from a recent low, while a bear market requires an asset to fall 20% from a prior high.

For example, the S&P 500 confirmed in June that it has been in a bull market since its October 2022 low.

Bitcoin Bull Market

Logarithmic view allows for better comparison of bull market returns

Since cryptocurrencies are often more volatile than stocks or real estate (sometimes moving 20% ​​in a matter of days), it may be more realistic to confirm bull and bear markets over longer time periods.

Therefore, let’s assume that a cryptocurrency bear market begins when a coin price is 20% below its most recent high for two months or more. A bull market begins when it climbs well above its most recent low and stays there for a month or more.

• This means that Bitcoin has been in a bull market for the past 296 days, the fifth bull market ever.

• On January 12, 2023, the Bitcoin trading price rose for the first time by 20% from the low reached before FTX declared bankruptcy in November last year.

• Bitcoin maintained these gains for a month and began its bull run on February 12, 2023.

Mathematical logic like this is interesting, but it should be emphasized that Bitcoin, like all other cryptocurrencies, is a very young asset.

With only about 13 years of price history, it’s a bit foolish to expect to gain any real insights from studying its past performance (either bull runs or the impact of halvings).

Still, comparing Bitcoin’s bull run so far to its previous major rallies shows some correlations: its returns are almost exactly the same as the previous two runs: 170%, compared to 165% in 2020 and 140% in late 2015.

Those rallies peaked in the thousands a few years later, though this one may pale in comparison as bull market returns diminish with each cycle.

Bull markets do not develop in a straight line either. Even within a multi-month uptrend, inter-cycle price corrections are common, ranging from 30% to 50%.

In any case, the past two bull markets lasted more than two and a half years — so if the bull market does make a comeback, it may be too early.