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Huobi Co-Founder Says Next Bitcoin Bull Run Could Be 3 Years Away

According to Huobi co-founder Jun Du, Bitcoin is unlikely to experience a strong bull run until 2025.

His analysis is based on certain crypto specialists’ assumption that the coin’s current run is coming to an end.

Surprisingly, Du has always aligned with Bitcoin’s bull run history.

The asset’s value reached as high as $69,000 during the 2020 bull run, which ended months before the mining reward was reduced from 12.5 BTC to 6.25 BTC.

Bitcoin Bull Run: 2025

However, Bitcoin has lost more than 40% from its previous peak. To put this in context, Bitcoin’s last bull run in 2018 saw the coin register a high of $20,000 before plummeting by more than 80%.

Du said a bull market happened between 2017 and 2021, and the next one is expected to come roughly a year after the 2024 halving. The theory is that by halving the supply, the price will rise.

Why Is Halving Important To Bitcoin?

A crucial part of bitcoin is halving, which refers to half the amount of money that so-called miners get as compensation for confirming transactions.

According to crypto specialists, the past two halvings occurred in 2016 and 2020, with the next one scheduled in 2024.

Given that both cryptocurrencies and tech stocks were lifted by central bank stimulus over the prior two years, the Federal Reserve’s intentions to hike interest rates sharply in 2022 have impacted both asset classes hard.

BTC total market cap at $713.715 billion in the daily chart | Source: TradingView.com

Related Article | 2022: The Year The Secular Bitcoin Bull Run Could End

Today’s Bitcoin Price Analysis

Bitcoin is currently trading at $37,643 and is still falling as of Tuesday, having breached the lower channel’s boundaries.

At the time of writing, Bitcoin had a market capitalization of $733,333,837,513. The crypto’s moving averages show a short-term bearish trend.

It has a present low of $36,488.93 and a high of $39,148.64, with an 81.48% trading volume reaching 33 billion.

Bitcoin’s price tumbled to new lows during Tuesday’s trade, falling as low as $37,200, a level it last reached on February 4.

Market observers expect Bitcoin to enter a bear market, with the subsequent significant rise not coming until late 2024 or early 2025.

Winter Is Coming

Analysts predict that Bitcoin’s current negative phase allows investors to accumulate it. According to a leading crypto intelligence firm, long-term investors were unaffected, but the short-term ones continued to drive Bitcoin’s price volatility.

Meanwhile, some investors believe that another “bitcoin winter” — when prices plummet and do not recover for a year or more — is nearing.

Bitcoin plunged from around $20,000 to below $4,000 during the last winter, between late 2017 and the middle of 2019.

Related Article | Bitcoin Bottom Signal From Bear Market, Black Thursday Could Save The Bull Run

Featured image from BlockPublisher, chart from TradingView.com

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Bitcoin Halving To Bring The Subsequent Crypto Frenzy

According to Thailand’s largest digital asset exchange, the world’s largest cryptocurrency, Bitcoin, will go through another significant run in 2024 when it goes through yet another halving. This means that Bitcoin will substantially increase during this period. As a result, we might see even higher levels than we’ve seen thus far. 

Related Reading: Bitcoin Halving Will Stir Next Crypto Frenzy

The halving is a process that occurs every four years. During the procedure, new token creation slows down to 50%. Additionally, many people believe this leads to Bitcoin price gains.

“The next halving is expected to bring about a “golden period” for Bitcoin in 2024-2025,” said Jirayut Srupsrisopa, CEO of Bitkub Capital Group. The golden period starts six months after the next halving when token creation cuts down by half.

However, digital tokens may suffer from a short period where the market is corrected and volatile as liquidity tightens. The result squeezes the fund inflows. Primarily by retail investors seeking safe-haven assets during these uncertain times, but it will not last forever.

“Institutional interest in the cryptocurrency market has caused it to change drastically,” said Jirayut, who also argued that this is because of a “big increase” with many institutions’ involvement. He cofounded Bitkub, valued at $1 billion last November, and works as its CEO for a Bangkok-based company.

Thailand To Ban Cryptocurrencies 

Bitcoin was on a tear last year, gaining thousands of dollars every few weeks until it hit almost $69K in November. However, things have been much more stagnant since then, with prices sitting just below where they were in November – around $38K or so at this writing. Some people say that the decline is due to less Federal Reserve stimulus prospectively, which benefited other assets during pandemic times. However, it may have had an effect now because everyone wants stability before investing heavily into anything again.

Bitcoin trying to break $40K support to fly high. Source: Tradingview.com

Regulators worldwide have started to tighten their oversight of digital asset activity. One such example is Thailand, which plans on banning its citizens from using cryptocurrencies as payment for goods and services in an effortless move that may help boost tourism there.

Related Reading | Ethereum Classic Displayed Double-Digit Gains; What’s Next!

The country’s finance ministry has forbidden banks from dealing with cryptocurrencies. Also ordered them instead to avoid direct involvement. In addition, the government will start collecting taxes on profits from trading digital assets. The process will establish regulations for an emerging market.

In response to regulator authorities, Jirayut said;

“Regulators are trying to use the old framework to govern new invention. But, unfortunately, that doesn’t always work. Countries without the right policies would drive innovation away, push the opportunity away.”

Featured image from Pixabay, chart from TradingView.com

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Since China’s Mining Ban, Bitcoin Hashrate Has Recovered by 68% And Counting

Bitcoin is a perpetual motion machine. The Bitcoin hashrate is slowly climbing to pre-China-ban levels, and the service continued uninterrupted without a hiccup. Such is the power of well-placed incentives. Pantera Capital’s CEO Dan Morehead adds one more factor to the equation. “The bitcoin network has recovered 68% of the drop in hashrate that our difficulty model attributed to China’s ban—likely in places with cleaner energy.”

The recovery is happening exactly as forecast.

The #bitcoin network has recovered 68% of the drop in hashrate that our difficulty model attributed to China's ban—likely in places with cleaner energy.

The transition to renewables is underway.

Sep Letter: https://t.co/xLyaLpPQQN pic.twitter.com/UsK9ML3BU8

— Dan Morehead (@dan_pantera) September 9, 2021

In the company’s newsletter, Pantera fleshes out the argument:

“Although difficult to know with certainty, it seems very likely that much of the reboot in mining power is occurring in places with cleaner energy than those utilized by Chinese miners. 

The transition to renewables is well underway.”

Regarding The Bitcoin Hashrate, Are ESG Concerns Even Important?

Here at NewsBTC we’ve determined that China’s Bitcoin mining tended to go to provinces with abundant green energy. Bitcoin incentivizes that. The Bitcoin hashrate tends to go where the energy is cheap. We’ve also determined that the environment doesn’t seem to be the reason for the Bitcoin mining ban.

“The fact that the electricity for crypto mining in Sichuan came from clean hydropower meant that many thought the province would be a safe haven for Bitcoin miners. As pressure on local governments to cut carbon emissions mounts, projects were successfully shuttered in some other provincial-level regions — such as Xinjiang and Inner Mongolia — where the mining was chiefly fueled by coal.” 

The only thing we can know for sure about the Chinese government’s plan is this: the environment is not on their radar. They’re closing these mining operations for other reasons altogether. 

It’s also important to remember that China’s Bitcoin hashrate dominance was already on decline before the mining ban. 

“According to Arcane Research, CBECI numbers say that:

China’s share of total Bitcoin mining power has declined from 75.5% in September 2019 to 46% in April 2021 — before the restrictions on Chinese miners were even imposed. That figure is much lower than the older estimate of 65%.

That’s a sharp decline. Why did China’s miners lose so much ground before the ban?”

None of this invalidates Pantera Capital’s original thesis, though. “The transition to renewables is well underway,” that certainly seems to be the case. And the Bitcoin hashrate keeps climbing. 

BTC price chart for 09/09/2021 on Timex | Source: BTC/USD on TradingView.com
Do Bitcoin Halvins Imply Cuts In Energy Consumption?

Another interesting idea present in the mentioned newsletter is this one:

“Bitcoin has a built-in mechanism to reduce energy consumption over time.  The number of bitcoin issued in the every-ten-minutes block reward is cut in half every four years.  Ceteris paribus, the amount of electricity Bitcoin consumes will be cut by 50% every four years.  For comparison, the Paris Accord only requires 7% cuts every four years.”

Of course, Bitcoin’s price fluctuates when related to fiat currencies. So, the value of every Bitcoin stays the same, but the price might – and usually does – increase more than twofold. Even though the miner’s rewards are cut in half, their earnings might increase. That extra money could bring even more competition and a Bitcoin hashrate increase with it. 

Taking that into account, Pantera poses:

“Perhaps a more realistic scenario is if the price of bitcoin were to double every four years in parallel with the halvings – putting bitcoin at $320,000 /BTC in 2032 – electricity consumption would be no greater than it is today.”

Enough About The Bitcoin Hashrate, What About The Price?

Another point that the newsletter makes is this one.“This is China’s third ban of Bitcoin.  The reverse hex is still working – the price is up 57%.”

Related Reading | New To Bitcoin? Learn To Trade Crypto With The NewsBTC Trading Course

Is this a bullish signal? Bitcoin’s price has “only” increased by 57% since the Chinese mining ban sent the Bitcoin hashrate in death spiral for a few seconds. Bitcoin paid the price and resisted sabotage like a hero. We’re not sure if a “reverse hex” could be considered reliable information, but… maybe this IS a bullish signal?

Featured Image by Diana Polekhina on Unsplash – Charts by TradingView and Pantera Capital