Crypto exchange Coinbase, one of the largest exchanges in the world, has released its latest report on Bitcoin and the crypto market, highlighting expectations for the industry. The 44-page report, launched by Coinbase Institutional in partnership with Glassnode, predicts a repeat of one of the most explosive bull markets in recorded crypto history; the 2018-2022 market cycle.
Coinbase Says Bitcoin Will Repeat the 2018-2022 Cycle
In the reportAnalysts from Coinbase and Glassnode take into account a number of indicators and metrics, such as total earnings supply, among others, to figure out what trend the next bull market is expected to follow. Now, after consideration and comparison with all previous bull cycles, the analysts conclude that the 2018-2022 cycle is most likely to be mimicked this time.
So far, Bitcoin and Ethereum are the cryptocurrencies that have shown the most correlation at the start of the 2018-2022 cycles, suggesting a similar breakout is in the offing. However, if you look at the chart, you will see that it is very different from previous cycles, especially since the bull market seems to be starting earlier than in 2020.
When it comes to the level of risk associated with assets like Bitcoin and Ethereum, the report highlights the fact that crypto has once again diverged from traditional assets. This comes after the correlation between crypto and traditional financial markets rose to new all-time highs in 2022. But as Coinbase explains, “2023 saw a return to historical norms, indicating that crypto can be a source of idiosyncratic risk.”
As another Bitcoin halving approaches, Bitcoin has also seen a resumption of its rise, boosted by expectations from a Spot Bitcoin ETF. Coinbase notes that “As crypto has matured as an asset class and institutional participation has increased, volatility has become increasingly lower.”
BTC price shakes out longs before recovering | Source: BTCUSD On Tradingview.com
What happens if the BTC price repeats the 2018-2022 cycle?
Looking back at the last bull cycle shows us what to expect if Bitcoin and the crypto market as a whole were to repeat the same trend. In this case, the expectations would be for the BTC price to rise at least 3x higher than the previous all-time high price of $69,000.
In this case, Bitcoin would be worth at least $200,000 by the time the next bull market is in full swing. Following the 3.6x move that Bitcoin made to reach its new all-time high in 2021 from its all-time high in 2018, BTC price would be looking at a cycle peak near $250,000.
As for Ethereum, if it follows the same trend and does a 3.2x jump from its previous all-time high to its new all-time high, it would take the ETH price above $15,000. In the same vein, the crypto market would also increase by over $10 trillion.
However, this is all speculation as the crypto market is known to deviate from expectations. Like the previous bull markets, the next one is expected to be new, especially given that institutional investors have fully committed to participating. This could mean hundreds of billions of dollars in liquidity injections that could drive prices higher than expected.
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