The Crypto Bull Market Is Just Getting Started

Bitcoin, Blockchain, Crypto, Cryptocurrency, Coin

Image Source: Pixabay

Crypto prices are starting to absolutely skyrocket, but we are just at the beginning of this bull market cycle. Whether you are an experienced crypto investor or a beginner, the current opportunity is too large to ignore. We believe that many of the cryptocurrencies that we track will go up 10x or more this year.

The approval of a spot Bitcoin ETF has been the key driver of recent gains in the crypto market. These ETFs have been some of the most successful ever launched, with billions of new capital flowing into these funds in the first few weeks. And there are no signs of this buying pressure relenting, with a record $2.5 billion in inflows last trading week ($3.2 billion in the past 7 days!)

To put this into perspective, these new spot ETFs are buying around 10x the daily issuance of Bitcoin each day! And unlike futures-based ETFs, the funds have to actually go out and buy Bitcoin in the open market, creating upward price pressure.

Bitcoin ETF approval has also removed regulatory risk, which was previously thought to be the biggest risk to investing in Bitcoin. This kept out many institutional investors until now, and they are showing a voracious appetite for Bitcoin thus far. 

The Bitcoin price has more than doubled in the past year to $52,000. But we believe the biggest gains are still ahead for the 'Apex Commodity."

One key driver of the coming gains is the Bitcoin halving, which occurs once every 4 years. The daily output of Bitcoin will be cut in half at some point in April of this year with the inflation rate falling to just 1.8%. This is lower than the official inflation target of 2% set by central banks.

The price tends to start rallying in the 12 months prior to the halving (as we have seen in 2023), but the largest gains typically come in the 6 to 12 months following the halving. If this pattern repeats again during the 2024 halving, we could see the Bitcoin price rally toward $150,000 by next year. 

Many believe this price estimate is too conservative, as Bitcoin has some "catching up to do" after the prior rally was cut short by the Terra implosion and FTX fraud. So even if you have been watching from the sidelines thus far, it is not too late to jump aboard this rocket ship. In fact, we are still in the early innings of the current bull cycle. 

Some laughed when Plan B's stock-to-flow (S2F) model fell short of predictions in 2021, but the deviation driven by Black Swan events proved to be an excellent buying opportunity. Now we are heading for a major deviation to the upside in my view and the chart suggests we are still in the accumulation phase (smart money).

Not only are emissions declining, but the number of long-term holders of Bitcoin has increased significantly in the past few years. In fact, it was reported that Bitcoin supply available for trade on exchanges has just dropped to the lowest level since 2015. Amazingly, around 70% of Bitcoin has not moved for at least a year, despite the rally.

When you couple declining supply and record high passionate long-term holders with a massive avalanche of new capital coming in from spot ETFs, it is not hard to guess where the price is heading. This is Economics 101 and the impact on price is starting to be realized. Still, we are not yet in the bull market (red dots) explosive phase. 

While we think investors have the opportunity to double or triple their wealth investing in Bitcoin over the next year, Ethereum is likely to offer even greater returns. This is because the same multi-billion dollar asset managers that recently launched spot Bitcoin ETFs have submitted applications for spot Ethereum ETFs. 

Ethereum has already experienced a protocol upgrade that has reduced emissions and even made Ethereum a deflationary asset. EIP-1559 implemented a fee burning mechanism that removes a portion of transaction fees from circulation. In the first year after the upgrade, the supply of ETH stopped growing and actually declined by 0.21%.

.Another near-term catalyst for Ethereum is the Dencun upgrade that is scheduled for March 13th. This upgrade will increase the scalability and efficiency of the network through five EIPs (Ethereum improvement proposals). 

While I prefer holding private keys in my custody, investors can now get access to Bitcoin through a number of new spot Bitcoin ETFs including: iShares Bitcoin Trust ETF (IBIT), Fidelity Wise Origin Bitcoin Fund ETF (FBTC), ARK 21Shares Bitcoin ETF (ARKB), Bitwise Bitcoin ETF (BITB) and VanEck Bitcoin Trust ETF (HODL). Michael Saylor's company Microstrategy (MSTR) also offers exposure to Bitcoin that they hold on the balance sheet and is now described as a "bitcoin development company."

Lastly, a number of Bitcoin miners such as Marathon Digital Holdings (MARA) have been offering leveraged gains to the Bitcoin price. My top pick in that sector is CleanSpark (CLSK). 

If you are new to investing in crypto, we include a "Beginner's Guide" that will help explain the basics, including where to buy each coin, the safest way to store them, how to avoid scams and other tips that make it easy to get started.

Watch for price dips to be shallower than usual now that institutional money has arrived. We expect to add our next crypto pick by early next week on this current pullback. 

We first recommended Bitcoin to subscribers under $1,000 and Ethereum at $12. Bitcoin has gone up 52x since and Ethereum is up 250x! While those returns are incredible, many of our altcoin picks outperformed those returns by a substantial margin during the last bull cycle and have started doing the same in recent months. 

But don't take my word for it alone, check out this short video clip of subscribers sharing their feedback and experience with Nicoya Research. 

More By This Author:

Fetch.Ai - At The Intersection Of Blockchain And Artificial Intelligence
3 Ways To Profit From China’s Dec 1st Graphite Export Ban
2 High-Risk/High-Return Mining Stock Picks

Nicoya Research LLC is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities customers should buy or sell ...

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.
Jason Hamlin 1 month ago Contributor's comment

The video referred to at the end of the article can be found on this page:

Please consider subscribing to get immediate access to our crypto portfolio, newsletters, trade alerts and chat room. But even if you deccide not to get our research, consider some non-zero allocation to crypto if you are still on the sidelines. Best of luck!