The Next Crypto Bull Run: What's Fueling the Wait?

As we enter into the last quarter of the year, one major anticipation in the air is the next crypto bull room. The anticipation has led many crypto

Cryptocurrency markets have seen several boom and bust phases over the years. Following Bitcoin’s 2017 surge and subsequent 2018 crash, another major bull run occurred in late 2020 and early 2021. Since then, the market has largely been in a corrective phase, leaving many investors wondering when the next sustained upswing will come.

This period of market correction has coincided with heightened regulatory scrutiny and concerns over inflation, interest rate hikes, and broader uncertainty in global markets. Earlier this year, the bitcoin halving event also took place, which typically serves to boost bitcoin’s value and increase demand for cheaper coins, setting the stage for the next market rally.

However, it’s worth noting that while cryptocurrencies were initially seen as a hedge against traditional markets, they are now also largely impacted by them due to their close linkages to the global financial system.

In both traditional markets and the cryptocurrency space, a bull run is characterized by rising prices, typically driven by high investor confidence, positive news, and strong economic fundamentals. The market experiences a dip, followed by a surge in prices, allowing coin holders to profit when they eventually sell and convert to fiat currency.

Just like in traditional markets, the crypto space is also driven by speculation, technological advances, and community sentiment. These factors, often overlooked by the average person, are crucial for timing buy and sell decisions in the cryptocurrency market.

To fully understand what drives a bull run, it’s essential to consider factors such as institutional adoption, technological advances, regulatory clarity, and macroeconomic conditions, all of which set the stage for the next market surge.

Several key developments are contributing to the anticipation and waiting game for the next crypto bull run:

Technological Advancements: Innovations like Ethereum’s switch to proof-of-stake, advances in decentralized finance (DeFi), and rising interest in non-fungible tokens (NFTs) suggest the technology is maturing. As these technologies improve, they could spur a new wave of adoption and investment, especially considering the real-world use, scalability, and security enhancements offered by cryptocurrencies. Increased institutional adoption also influences these events, such as financial firms like Blackrock beginning to offer exchange-traded funds (ETFs) and crypto investments.

Regulatory Clarity: One big hurdle for cryptocurrencies has been the lack of clear regulatory stance in several countries, with Nigeria being a classic case where the regulations have long been hostile. However, as governments finally define their stance on digital assets, it will boost investor confidence.

Macroeconomic Factors: With rising inflation and unstable markets, investors are seeking alternative assets to protect their wealth. Cryptocurrencies, with their decentralized nature and limited supply (in the case of Bitcoin), are seen by some as a hedge against inflation and economic uncertainty. If global markets continue to struggle, we could see a shift of capital into digital assets, potentially sparking a new bull run.

The question on everyone’s mind is whether a bull run will occur before the year ends. At the time of writing, Bitcoin is trading at $57,928.01 (BTC/USD), with a market capitalization of $1,144.03B.

Based on current global events and market dynamics, which are influenced by economic events, it seems more likely that the bull run may extend into the new year. This will bring a flurry of developments in the crypto market and politics, likely to shift market dynamics and inspire the next run.

Since a dip is a prerequisite of a bull run, we should expect a sharp drop in bitcoin’s price just before the bull run.

It’s essential to understand the psychology behind it. The cryptocurrency market has always been driven by emotion as much as by logic. Fear of missing out (FOMO) during bull runs and fear, uncertainty, and doubt (FUD) during bear markets drive investor behavior.

This emotional rollercoaster can cause investors to make irrational decisions, such as buying high, hoping for more gains, or selling low, fearing losses. For those waiting for the next bull run, it’s crucial to stay disciplined. The market is unpredictable. It’s tempting to act on hype. But a more measured approach often pays off in the long run. It means doing thorough research. You must understand the assets you’re investing in. You need a clear strategy for entering and exiting the market.

So, what should you as an investor do while waiting for the next bull run?

Stay Informed: Keep up with the latest news in the crypto world. Know the tech, regulations, and trends that may drive the next surge. While new coins are being hyped, look beyond them. Understand the ideology behind meme coins. Many ‘shitcoins’ will be released. Knowing which coin to buy will be an invaluable insight you will want to have.

Diversify: Don’t put all your eggs in one basket. Investing in different asset classes and in crypto can lower risk.

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