So what is happening to the cryptocurrency market today? In fact, many people already know it, or have heard it before: crypto winter has arrived.
Today, the entire cryptocurrency market is in drawdown. It would seem as if only yesterday we were looking at Bitcoin quotes when it took its historic high of $69,000 and expected that a little more time and the first cryptocurrency would cost at least $100,000. But as it usually happens, something didn't go according to plan and BTC quotes went down sharply. As of this writing, Bitcoin is trading at $18,000. There were experts who predicted a collapse to $12,000, but it hasn't happened, at least not yet.
Conventionally, crypto winter is a period from ATH of Bitcoin price to new halving in Bitcoin network. Accordingly, the end of this period will occur when the next halving in the Bitcoin network occurs. But it is clear that you are more interested in the phase in the market of Bitcoin and other cryptocurrencies, when the price decline finally stops, that is, the point at which the recovery phase will begin. By the way, this point is called the point of reversal, and the period from the point of reversal to halving is called the period of averaging the price of Bitcoin.
The price movements of Bitcoin are cyclical, so we know that the price of Bitcoin will be averaged to a value that will be significantly higher than the price of the point of reversal and lower than the ATH price of Bitcoin.
What will happen to Bitcoin
So, in the dynamics of Bitcoin price formation it is easy to identify 4-year cycles. And having distinguished them, you can easily see three basic movements: growth, correction and averaging. In turn, these movements are repeated every 4 years, i.e. periodically.
The Bitcoin price is directly related to the Bitcoin mining economy, and Bitcoin mining directly depends on the miners' remuneration, which in turn is halved every 4 years..
So, by comparing the price movements of Bitcoin with past 4-year cycles, we understand, firstly, that the crypto winter of 100% will not last longer than April 2024, and secondly, that the reversal point, as usual, should be in that period, where we are now, i.e. from December to April 2024. Why «as usual»? Because it was already so.
The most dramatic events of past eras were about a year and a half before the halving, it was so in early 2015 (before the 2016 halving), and early 2019 (before the 2020 halving), and it will probably be so now.
What's stopping Bitcoin from growing?
Most likely, the geopolitical situation in the world, and the drawdown of the world economy as a whole, prevents Bitcoin from starting a new growth. This probably does not mean that Bitcoin, along with all the other tokens and coins, will be in the drawdown until the world is calm. Already now we can see a slight increase in the first cryptocurrency.
The main thing to remember is that the market is cyclical and underwater crypto winters have already happened. We can only hope that everything will stabilize as soon as possible and Bitcoin will start hitting new historical highs.
