The Longest Bear Market: A Possible Bitcoin Revival?

The Longest Bear Market: A Possible Bitcoin Revival?

Cryptocurrencies, led by Bitcoin with its current price at $26,082 (Bitcoin to GBP price standing at £20,517), are not enduring their supposed “longest-ever bear market”. In fact, they may not be in a bear market at all, according to some industry experts. Does this signal for Bitcoin revival? Let’s find out!

A Matter of Interpretation

On August 27, Michaël van de Poppe, founder of MN Trading, declared on social media platform X (formerly Twitter) that Bitcoin is in the “longest bear market” ever recorded. He stated, “Right now, the price of Bitcoin is nowhere near the valuation of the peak in November ’21. It’s down more than 50% and in a bear market of 490 days.” However, this statement has stirred debate among crypto enthusiasts who challenge this perspective.

Determining the duration of the current “bear market” requires understanding that the terms “bull” and “bear market” can be subjective. As Mati Greenspan, founder of Quantum Economics, pointed out, these terms can indicate past price movement or anticipated future direction. He explained, “It can mean either the price has moved in the past or that the price is expected to move in a certain direction in the future.”

Bitcoin’s Market Cycles

Analyzing Bitcoin’s market cycles can provide different insights into the mastery of this crypto. According to Allen Scott, a market editor at Cointelegraph, the current situation might be a “multiyear bear market”. Such sentiment may remain until a new all-time high is achieved. Under this perspective, Bitcoin has been in a bear market for 659 days, starting when it reached its historic peak of nearly $69,000 on November 10, 2021. While this period exceeds Van de Poppe’s mentioned duration, it still doesn’t qualify as the longest “bear market” using this approach.

Historically, Bitcoin has experienced extended periods when its price remained below previous highs. For instance, between November 2013 and January 2017, Bitcoin’s price did not recover to $1,000 for 1,125 days over three years. Likewise, the coin has reached $20,000 in December 2017. Soon after, it took Bitcoin 1,095 days to surpass that level. Yet, it is debatable whether Bitcoin was truly in a “bear market” during these times, considering it was moving toward its all-time peak of $68,000.

Bitcoin Revival: The 20% Decline Rule

Another interpretation suggests that Bitcoin may not be in a bear market at all. Traditionally, a bear market is a market index or asset declining by 20% or more from its recent high. Bitcoin’s most recent high, approximately $31,400, occurred in mid-July 2023. Presently, Bitcoin’s price is down by around 13% from that level, which falls short of the 20% threshold. Moreover, Bitcoin has registered a 34% increase over the past year.

A Continuous Bitcoin Bull Run?

Samson Mow, CEO of Jan3, provided an alternative perspective, asserting, “If you zoom out enough, Bitcoin is just one big green candle and has been in a continuous bull market since 2009. I guess those that focus on short timeframes might be experiencing a bear market.” Mow also indicated that the current market situation appears “very bullish” due to factors such as high inflation, diminishing purchasing power, rising debt, and adoption by nation-states like El Salvador.

Bitcoin’s Market Cycles

In the world of Bitcoin and cryptocurrencies, the definition of a “bear market” remains subjective and open to interpretation; many believe Bitcoin is making headwinds with its revival. However, some may argue that Bitcoin is currently experiencing its longest bear market. Historical analysis and alternative viewpoints suggest that this assessment may not hold water. Bitcoin’s market cycles have seen extended periods of recovery and growth, and the 20% decline rule offers another perspective on the matter. Ultimately, whether Bitcoin is in a bear market or not may depend on one’s time horizon and interpretation of market dynamics.