As the calendar shifts from summer to autumn, the crypto market follows suit, signaling the end of a season marked by volatility and uncertainty. Crypto summer, from June 20, 2024, to September 22, 2024, was characterized by market crashes and brief rallies, leaving investors eager for what lies ahead. Historically, the transition from summer to autumn has often been the precursor to a bullish phase in the crypto market. Many believe the stage is set for a powerful bull run that could extend well into 2025 and 2026. Here are five key reasons why the crypto summer is over, and a new bull market may be imminent.
5 Indicators Signaling the End of Crypto Market Summer and the Onset of the Bull Run
Summer is over, and Autumn is here. Historically, many great things happen in crypto, the chief of which is the bull run supercycle. The Bitcoin price has increased materially following each halving, with the bulk of the returns realized between 12 months and 18 months after the halving event. Here are things to watch out for that signal the beginning of the bull run:
1. Rate Cuts
The most recent U.S. interest rate cut by the Federal Open Market Committee (FOMC) resulted in a Bitcoin price surge. The cut was the first in the last four years and sparked optimism in the markets for the potential start of the crypto bull run. The 50-basis points (bps) cut on September 18 marks the first of many aimed at curbing inflation. Crypto inflows surged by over $300 million following the Fed’s rate cut, signaling it could be the potential start of a market rally.
2. Q4 (historical data points to 98% return in Q4)
Historical data points to a strong price performance of Bitcoin and cryptocurrencies in the fourth quarter of the year. For instance, over the past 12 years, Q4 has had an average return of 98%, according to data from Coinglass.
This seasonal trend is attributed to investor optimism and increased market activity as the year comes to a close. If this pattern replicates this year, we could see a significant rally in the crypto markets as we move into Q4.
3. CZ’s Release Soon
The anticipated release of Binance Founder Changpeng ‘CZ’ Zhao from prison on September 29 could also serve as a major catalyst for the market. CZ is a high-profile, influential figure in the crypto community, and his Binance leadership has been key to the mass adoption of cryptocurrencies worldwide. His release would restore confidence among investors, potentially leading to a surge in crypto prices and the start of the bull run.
4. FTX Repayments
The repayment from the FTX collapse is another factor that could inject liquidity back into the crypto market. As victims of the FTX collapse receive their funds back, they could reinvest this capital into cryptocurrencies. This will drive up demand and prices. The FTX situation is currently experiencing an overhang in the market, and its resolution would allow more stability back into the markets. The company said it has between $14.5 billion and $16.3 billion to distribute to creditors.
5. Elections
The upcoming U.S. elections on November 5 will likely play a crucial role in the crypto markets. This year’s election is one of the most crypto-integrated in American presidential elections. Following the elections, there has, historically, been a rally in both BTC and traditional markets. The effect may be even more pronounced this year as both presidential aspirants find ways to pander to the crypto masses. However, if Donald Trump wins, a significant crypto bull run could occur compared to Kamala Harris.
Conclusion: Crypto Bull Run Incoming?
These factors indicate that the crypto market summer is over, and a bull run may be imminent. All of them are major market-moving events that could take place between now and the end of the year, potentially sparking a bull run.
Frequently Asked Questions (FAQs)
The end of summer, specifically from June 20, 2024, to September 22, 2024, marks the conclusion of a period characterized by market volatility, including crashes and mini-rallies. Historically, autumn often ushers in a favorable environment for the crypto market, potentially leading to a bull run.
Historically, the fourth quarter (Q4) has shown strong performance in the crypto market, with an average return of 98% over the past 12 years.
The U.S. elections on November 5, 2024, are expected to have a considerable impact on the crypto market. Historically, elections have led to rallies in both Bitcoin and traditional markets. This effect may be even more pronounced this year, especially if a pro-crypto candidate, such as Donald Trump, wins, potentially triggering a significant crypto rally.
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Evans Karanja
Evans Karanja is a crypto analyst and journalist with a deep focus on blockchain technology, cryptocurrency, and the video gaming industry. His extensive experience includes collaborating with various startups to deliver insightful and high-quality analyses that resonate with their target audiences. As an avid crypto trader and investor, Evans is passionate about the transformative potential of blockchain across diverse sectors. Outside of his professional pursuits, he enjoys playing video games and exploring scenic waterfalls.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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