Today, for the first time in its history, the price of Bitcoin (BTC) has exceeded $73,000, setting a new ATH.
ATH is an English term that stands for All Time High, literally meaning “higher than ever before”.
The Bitcoin cycle: new ATH for the price of BTC
To compare this price with the historical data of previous years, we need to refer to the ATH of the previous cycle, which is the $69,000 reached in November 2021.
Well, actually the current Bitcoin cycle is still the one from 2021, since the new cycle will only start after the April halving.
In the past, it had never happened that after a post-halving bubble, resulting in a bear market, the price of BTC had set a new ATH within the same cycle, that is before the next halving.
Indeed, after the first halving, in 2012, there was a great bull run in 2013, with the ATH reaching about $1,100. After the bear market of 2014/2015, the second halving took place in July 2016, followed by the new ATH only at the beginning of 2017.
The bull-run of 2017 marked a new ATH at around $20,000, and after the bear-market of 2018 there was the third halving in May 2020 and the new ATH at the end of the year.
Even the post-halving bull run of 2021 was similar to previous ones, with an ATH of 69,000$.
And even the following bear-market, that of 2022, was similar to those of the past. But something changed last year.
Indeed, since the news of the likely approval by the SEC of Bitcoin spot ETFs in the USA was published, an early bull run has begun, which not only anticipated the halving (something that has never happened before), but is still ongoing.
The Bitcoin supercycle: will new ATHs for the price of BTC arrive?
At this point, it is not surprising that there is also talk of the possibility that a Bitcoin supercycle may have started in October 2023.
The term “supercycle” refers to a longer and broader cycle that goes well beyond the classic 4-year cycles.
Bitcoin has a halving exactly every 210,000 blocks, and at a rate of a new block every less than 10 minutes it takes just under 4 years between one halving and the next.
Bitcoin cycles marked by halving in the past have always had a similar impact on price trends. In fact, both after the first and after the second and third halving, a bull run started that lasted about 12 months, from the end of the halving year to the end of the following one.
In all three of these cases, the great bull run was followed by about 12 months of bear market, although in 2015 the duration was slightly longer.
The point is that the first two major bear markets were followed by a couple of years of upward consolidation, while the third was followed by less than 12 months of upward consolidation.
Indeed, in October 2023 the sideways phase ended and a new bull run started one year ahead of schedule.
The hypothesis circulating is that this difference is precisely due to the Bitcoin spot ETFs on US exchanges.
The gold supercycle
One can indeed draw a comparison with the gold supercycle.
The prices of gold on financial markets have been known since the 1930s.
Two large supercycles can be fairly clearly recognized.
The first one began in 1972, shortly before the great oil crisis of the 1970s. It lasted eight years, until 1980, and brought the price of gold from $38 per ounce to a peak of over $800 per ounce.
This first supercycle, however, was followed by a very long bear market, which ended only in 2001 at $250.
Starting from 2002, the second supercycle of the price of gold began, lasting for nine years, during which the price of gold rose above $1,900. It is worth noting that the current price is around $2,100, so not much higher, in nominal terms, than the peak of 2011.
The fact is that this second supercycle was precisely due to the arrival on the US stock exchanges of the first spot gold ETFs.
The comparison between the two assets
Actually, however, there is an important difference between these two scenarios.
Indeed, before the arrival of gold ETFs, it was not possible to buy gold directly on financial markets in the form of non-physical assets.
Instead, Bitcoin has been purchasable on financial markets as a non-physical asset since 2010, the year following its creation.
Some ETF experts argue that the influx of new capital into the Bitcoin market due to ETFs may not last nine years, as was the case with gold, but at most two or three years. One of these is precisely 2024, the year of the fourth halving, and the following is the post-halving year during which historically there has been a major bull run.
So the hypothesis of the Bitcoin supercycle would seem to have a basic logic that makes it at least possible, and this could indicate that the current bull run is far from over.
Yesterday, for example, in just one day over one billion dollars of new net capital arrived on Bitcoin ETFs, thus setting a new record. Also, the daily trading volumes of Bitcoin ETFs yesterday set a new absolute record.
However, it will be necessary to pay close attention to what will happen after the April halving, because usually the effects of the halving on the price of BTC take a few months to manifest.
