The king cryptocurrency bitcoin showed promising movement over the weekend, which surprisingly encouraged altcoins as well. The conversion of Bitcoin‘s $28,800 resistance area into support was a significant move. However, experienced investors are focusing on long-term cycles rather than short-term movements. One famous crypto analyst says that this cycle is different, and he has five reasons for it.
BTC rise equals the rise of other cryptocurrencies. We have never seen the majority of altcoins reach new all-time highs during a bull season when BTC ATH was not seen. Since the king cryptocurrency dominates the market, investors should follow the 4-year BTC cycles.
The halving represents a crucial period in these cycles. Historical data tells us that there are 2 years of increase, 1 year of decrease, and the last year is an accumulation period. The crypto analyst known as Caprioleio believes that the current cycle is different from the others. He has five main reasons for this:
The first detail that Caprioleio highlights is the hash rate. It shows how active miners are and how much computational power they dedicate to this process. If this is strong, the network becomes more secure and powerful. According to the graph shared by the analyst, this indicator is at a “crazy” level.
While BTC reached ATH at $69,000, the hash power was at a lower level. So why did this happen?
“This indicates the growth in industrialization. Energy companies and governments are here.”
This cycle is different because, as we mentioned earlier, long-term investors have been accumulating like crazy. The metric that reached this level in 2015 is now back at its peak in the middle of the bear market. These levels were not seen even at the beginning of the 2021 bull market or the 2017 bull market.
If a large part of the supply is in the hands of long-term investors, there is less BTC available for sale on exchanges. It is not difficult to predict where the situation can evolve with the approval of a spot BTC ETF. Although volumes are weak, only 24.8% of the supply is available for sale. This means that there could be a larger rally in case of increased demand.
If governments can mine gold, why not mine BTC? If you had asked this question years ago, the answer would have been “What is Bitcoin?” Today, governments legitimize, support, and even engage in mining themselves. Apart from being on the US sanctions list, there is no problem with this.
Lightning Network transactions have increased by 1200% in 2 years. We have seen this despite the fluctuations in the king cryptocurrency. The expert analyst said that the locked value on the network has exceeded $150 million for the first time. The increase in interest in LN that makes the decrease in BTC price meaningless is exciting.
LN, which helps fast and cheap BTC transfers, stands out more in the crypto payment services sector. If transactions are increasing by 1200%, what does this mean? We should definitely say that the king crypto is being used more intensively for payments.
Analyst Caprioleio gives an example of a hamburger that can be bought with BTC at McDonald’s. Elon Musk’s steps, more companies starting to accept crypto (LN data supports this), and many other developments confirm this.
This is a fillable opinion, and it may be useful to remember some of them.
So what’s the conclusion? Many metrics are at bull levels, and it’s in the middle of the bear season for BTC. As the CEO of BlackRock said, there is suppressed interest, and that’s why the price is not at the desired levels. But why? The only explanation for this is the macro developments. Indeed, the reason behind everything we follow, from US PMI data to Unemployment Claims (data we didn’t care about in the past), is when will the Fed give up tightening further?