Author: Crypto_Painter
Source: X, @CryptoPainter_X
The Current Bull Market:
1. Slow growth, lacking the profit potential seen in previous bull markets;
2. Poor liquidity, with most high-value altcoins, apart from BTC, failing to reach new highs;
3. Lack of attention, with social media interest significantly lower than in past bull markets.
Let’s discuss these three points systematically:
1. Is the current bull market slower than previous ones?
Determining the speed of this bull market is a technical issue. Momentum in price increases is not solely about the rate of change but also about sustainability. For example, if a bull market takes a year to complete, and it spends the first 11 months in a low-level oscillation, only to surge by 300% in the final month before the bear market begins, can this be considered a bull market? Despite the rapid growth in the final month, this situation does not indicate sustained demand in the market; it is merely a result of manipulation by major players, often seen in small-cap altcoins where the purpose is to pump and dump. Therefore, for BTC, a true bull market requires long-term sustainability, with continuous buying pressure leading to a gradual price increase, reflecting long-term demand and genuine market activity – buying, holding, and long-term investment.
Analyzing the price growth of each bull market from three dimensions – the duration of the bull market, the increase in prices brought by the bull market, and the momentum during the bull market process – reveals a decreasing trend in the early stages of recent bull markets, with average daily price increases of 1.10%, 0.71%, and currently 0.65%. Even if BTC were to break out to new highs in a frenzy, the current bull market’s early-stage growth rate remains lower than in previous bull markets. Therefore, it is evident that this current bull market is indeed slow.
Now, let’s look at price momentum:
The charts below correspond to the performance of BTC on the ASR-VC trend indicator after breaking new highs in 2017, 2020, and 2024:
It seems that there are notable differences between the bull markets of the past and the current one in terms of trend momentum. Previous bull markets saw successful breakthroughs after significant pullbacks, maintaining an upward trend. However, the current market has seen several unsuccessful attempts to break new highs, with the daily green channel midline showing a flat trend, a situation unseen in history. This indicates that the current bull market’s early-stage momentum is far weaker than in previous bull markets.
While this does not imply that the current bull market has peaked, the lack of a solid foundation and sustained demand suggests prolonged consolidation around previous highs. The weak foundation can be attributed to the insufficient liquidity in the market, leading to prolonged consolidation near previous highs.
So, why is the foundation weak?
Let’s now compare the overall liquidity of the current bull market to previous ones:
Although liquidity levels do not directly reflect price movements, they determine the upper limit of price increases. Observing the overall liquidity of the cryptocurrency market involves analyzing both on-chain liquidity and off-chain liquidity.
First, let’s consider on-chain liquidity, which refers to assets already converted into stablecoins or cryptocurrencies. Looking at the performance of USDT during previous bull markets, we can see a significant difference in the increase in market value compared to the current bull market. While the total market value of stablecoins has increased in the current market, it falls short of the levels seen in previous bull markets. This indicates that the total liquidity accumulation in the current bull market is insufficient compared to previous ones.
The lack of this additional liquidity poses a significant threat to the current bull market. As stablecoin market values stagnate, the potential outflow of liquidity could jeopardize the market’s stability. The recent resurgence in ETF inflows may provide some support to BTC prices amid stagnant stablecoin market values. The key focus now is on whether stablecoin market values can sustain an upward trajectory to provide the necessary liquidity for a breakout.
Moving on to off-chain liquidity, specifically the net flow of USD:
Comparing the net flow of USD in the current bull market to previous ones shows a significant decrease in external liquidity, indicating a lack of overall liquidity. However, despite the challenging external environment, BTC has managed to achieve new highs, showcasing a higher proportion of traditional capital flowing into BTC compared to previous bull markets.
In summary, the current bull market faces challenges due to insufficient liquidity accumulation. While external conditions are unfavorable, the slow growth and steady increase in liquidity indicate a gradual shift in investor trust towards BTC.
Concluding with social media attention:
Compared to previous bull markets, the current bull market has attracted less attention on social media platforms. Despite BTC being the focal point of global attention in the crypto industry, data reveals a decrease in interest and engagement levels. However, if BTC continues to show strength and surpass the $100,000 mark, dormant retail investors may return.
In essence, the current bull market differs from past ones due to its rapid initial growth, necessitating a trade-off between time and space. Sustained growth in liquidity and market stability will determine whether BTC can break through the current range or face an early end to the bull market. While challenges persist, the increasing trust and interest from traditional capital indicate a positive shift in BTC’s market dynamics.
