Is the BTC bull run over?

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BTC has been languishing around the $65,000 mark for months now, leading some to wonder whether the fabled digital currency bull run is already over or if it might not happen at all this time.

In this piece, I’ll outline why it feels different this time, what some potential catalysts for a new digital currency bull market might be, and why a much larger, more mature blockchain bull market that will last for decades has begun.

Why does it feel different this time?

There’s no doubt about it; the usual euphoria and speculation that occurs in the lead-up to the Bitcoin halving and shortly after hasn’t happened. It just doesn’t feel the same this time.

One reason is that many people no longer trust ‘crypto’ and don’t take the industry seriously. As meme coins like DogWifHat and PEPE deliver 500%+ gains, serious investors with real financial power must be wondering what on earth is happening. In the wake of the industry-wide collapse that occurred at the end of the last bull market, including revelations of mass-scale fraud at FTX, it was crucially important for the blockchain and digital currency space to reform and get serious. Unfortunately, meme coins delivering outsized gains don’t signal that it has.

Another reason for the sluggish market this time around is economic reality. This is the first cycle in which BTC and other digital currencies have faced serious central bank rate increases. Post-2008, U.S. central bank rates were no higher than 0.25% until 2015, after which they gradually rose to 1.75% in 2019 before returning to between 0% and 0.2% when the pandemic hit.

This time, there is no easy money, and with a risk-free rate of >5%, there’s little incentive for most to speculate on Bitcoin and other digital currencies. Additionally, inflation is higher than it has been in decades, and many people just don’t have the spare cash to speculate on something they perceive as highly risky and associated with scams.

Some potential bull catalysts

However, there are a few rays of hope for those interested in speculating on digital currencies. There are some catalysts that could ignite another speculative bull market, albeit probably tamer than previous ones.

First, while inflation is high, it is falling across the board, and this may lead to rate cuts by the Federal Reserve soon. If this occurs, digital currency markets would likely get a bump as economic conditions loosen and credit flows more freely. Some cash may also move into risk-on mode as the rate of return on treasury bills and bonds drops.

The U.S. election could be another catalyst. Currently, President Joe Biden is virtually tied with Donald Trump in the polls. Should Trump win, his stated Bitcoin-friendly policies and likely tax cuts could fuel a bull market in both equities and digital currencies.

Another potential reason for further bullish prices is institutional adoption. BlackRock already launched a BTC ETF that saw huge inflows, and there have been persistent rumors about an ETH one, too. While things are slowing down right now, easier ways to buy popular digital currencies would almost certainly move prices upward.

The much bigger bull market most aren’t paying attention to

Whether or not the short-term speculative cycle has legs is yet to be seen. However, I’m much more interested in the more exciting, longer-term blockchain startup bull trend. I’m talking about the massive utility and new wave of next-generation apps that have been unlocked thanks to a broader understanding of what the technology can do and the startups being formed to take advantage of it.

Take Sentinel Node on the BSV blockchain, for example. This app, developed by CertiHash and IBM (NASDAQ: IBM), uses the timestamping mechanism of blockchain technology to detect computer network intrusions and alterations quickly. This application alone has generated 17,000+ on-chain transactions in the last 24 hours, showing real use and utility.

Another example is mBridge by the Bank for International Settlements Innovation Hub. This blockchain-based project will dramatically reduce settlement times and costs associated with cross-border payments. Multiple large Chinese banks have already tried it, and the central banks of China, the United Arab Emirates, Hong Kong, and Saudi Arabia are involved.

At the London Blockchain Conference 2024, we heard from various blockchain pioneers about tokenizing real-world assets. Everything is moving onto the blockchain, from financial securities like stocks and shares to luxury goods like designer handbags and clothes, where it can be tracked, traced, and followed closely. This will undoubtedly lead to greater efficiency, less theft and loss, and more integrated, transparent supply chains.

It seems the whole world has finally caught on to how blockchain technology can be used to create positive change and disrupt or transform the dinosaurs that have dominated industries for too long. For me, that’s where the real alpha is. Investing in blockchain startups could make any of us the next Don Valentine, and starting one could make us the next Bill Gates.

Forget gambling on the manipulated, fraudulent, nothing-new digital currency markets. Blockchain startups are the new cool thing to invest in, and these will drive a much bigger bull market that will deliver gains for decades to come.

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