3 main differences between 2017-2021 Bitcoin bull runs!
In what way are the 2017-2021 Bitcoin bull runs similar? Bitcoin price broke all-time record in 2017. So, can we expect the same from altcoins at the top? What is the difference between the latest situation in the Bitcoin market and the past?
After a very long wait, Bitcoin finally returned to its price three years ago and exceeded $ 19,000. When Bitcoin hit $19,900 in the bull run in 2017, altcoins gained up to 200% in value.
Currently, BTC is back to where it was in December 2017, with its price exceeding $19,000.. You might think that not much has changed since then, other than the disappearance of some altcoins, but that would not be a realistic assumption.
A lot has changed in the cryptocurrency industry since then. Compared to 2017, remarkable developments have been made in terms of infrastructure.
Today, with the launch of CME and CBOE futures contracts, very tightly regulated derivatives were introduced to the market, and on the other hand, The rapidly growing Bitcoin demand by institutional investors has left its mark on the market.
An important difference is the emergence of DeDFi platforms with a multi-billion dollar market cap.. These platforms support a new credit system, synthetic swap and interest-bearing systems for a whole new set of investors.. Looking at this data, investors will better understand how the market today differs from the market in 2017.
Then by addressing these differences, we can do some analysis of how the market will look in the years to come.
Bitcoin What has changed for bull runs since then?
If we look at the ranking of cryptocurrencies by market capitalization, four of the top five coins are still in the same order.. Strangely enough, ETH and XRP continue at the same rate as market value.. ETH is $69 billion and XRP is $28 billion. This is an ongoing situation even though both cryptocurrencies have seen a 15% price drop since December 2017.
This is due to the launch of new coins.. For example, Ether’s coin supply increased from 96.4 million to 113.7 million. Equivalent inflation stood at 17.9% over three years. By comparison, the total number of Bitcoins in circulation increased by 10.8% in the same period.
Leaving aside Bitcoin, Ether, and XRP, other cryptocurrencies in the top 20 suffered huge losses.. IOTA 91%, Bitcoin Cash (BCH) 84%, Litecoin (LTC) 73%, and Cardano (ADA) 70%. Let’s not forget that the only new coins in the top 15 are Chainlink (LINK), Polkadot (DOT), and Binance Coin (BNB).. There is even that, Polkadot is a cryptocurrency that was not in the market in 2017 -2018.
On the other hand, ETH’s competitors Cardano, EOS, NEO, Ethereum Classic (ETC), and QTUM are candidates to be among the losers.. Moreover, they began to be replaced by coins with interoperability features such as Polkadot and Chainlink.
The top 3 coins BTC, ETH, and XRP, with a market cap of 448 billion dollars, showed a 7% increase in three years.. Meanwhile, the total value of the other 21 leading coins has reached $77 billion, which means an increase of 41%. came to 63%.
Another remarkable development in this process is the prominence of three token types.. Stable coins, Exchange tokens and the decentralized DeFi sector.
Institutional investors will push prices higher
As previously mentioned, relevant liquidity aside, CBOE and CME futures did not exist in December 2017. The same can be said for institutional investors to praise and effectively invest in Bitcoin.
More recently, BlackRock CEO Larry Fink even considered Bitcoin an asset class in its own right. began to speak positively about becoming. Derivatives give Bitcoin and Ether a tremendous competitive advantage for professional traders’ money. Recent positive comments from Heath Tarbert, chairman of the US CFTC regulatory board, have brought the launch of ETH regulated futures one step closer.. In addition to their dominance in the derivatives markets, the 97% orientation of Grayscale Mutual funds to BTC and Ether provides us with sufficient information about this theory.
What will affect the next bull run?
Trying to predict major market changes in the future is often not a very effective strategy, but still, it can give us some ideas. is a theory that it is proportional to their current age, so each additional period of survival means a longer life expectancy. Where the Lindy effect applies (death rate decreases over time), the life expectancy of some technologies is proportional to their age, and the longer their survival time, the more predictable their existence. The longer the currency stays in the top 12, the more likely it will hold true after three years.
Take, for example, the ‘killer’ rumor of Bitcoin and Ethereum. This rumor was incredibly popular in 2017 and 2018 when it was predicted that rival blockchains would surpass industry leaders due to faster throughput, cheaper fees, and improved scaling or ‘real world use’.
These narratives sounded in 2017. While it may make sense, time Network Effect (In economics, a network effect is the phenomenon where the value or benefit a user derives from a good or service depends on the number of users of compatible products.. Network effects are typically positive, resulting in a particular user getting more value from a product as other users join the same network.). The best technology doesn’t always win.
Another unique phenomenon in the crypto industry that investors should watch out for is hard forks and codebase clones.. In 2017 Bitcoin Cash (BCH), Bitcoin Gold (BTG), Ethereum Classic (ETC) and DASH hard forked, competitive clones released. They were initially successful, but when you examine their prices and market caps, their success turns out to be short-lived.
The total coin supply and issuance rate of a cryptocurrency can also affect its price performance.. High-issuance cryptocurrencies may have trouble capturing price. This includes XRP, Chainlink (LINK), Polkadot (DOT), Stellar (XLM), Tron (TRX), and Tezos (XTZ).
Retail-focused influx will certainly push some altcoins higher, but there are others with real use cases this time around
Looking at usage growth, sectors likely to see increased attention include oracles, interconnection, decentralized exchange (DEX) tokens, non-custodial lending, and liquidity supply.
As seen in the 2017 bull run through 2021 There is a lot of difference between the expected bull run. This time, we have a more conscious society, more relevant institutional structures and developing technology.. In the coming years, the crypto money market will continue to grow and take more place in our world, and we will witness large digits flying in this market.
Source
A Hacker Is Arrested After Stealing $365,000 Worth Of Bitcoin From Darknet Markets