Crypto Bull Market Nears End, Says CryptoQuant Analyst

Highlights:

• CryptoQuant’s Crypto Dan warns the current crypto bull market may be nearing its end.
• 36% of Bitcoin’s market cap from recent trades signals an approaching market peak.
• Crypto Dan advises caution and plans to liquidate holdings as market risks increase.

In a Jan. 6 post. CryptoQuant analyst and Korea Community Manager Crypto Dan said the current bull market in the crypto industry may be in its final stage. The bull cycle that began in January 2023 has brought significant gains for Bitcoin, evident in both its duration and price performance, he said.

A large inflow of new investments has fueled the market’s growth. Additional funds from existing investors have further strengthened this trend. Given these developments, the market is likely entering the latter stages of this cycle.

Data shows that 36% of Bitcoin’s market cap is made up of coins traded in the past month. Although this figure is lower than previous cycle peaks, it still suggests the market is approaching its top. This trend suggests the market could peak between Q1 and Q2 of this year. However, Crypto Dan points out that, instead of a sudden price spike, the market may experience a gradual increase. This could eventually lead to overheating, which may trigger a bear market.

The Market Has Entered the Later Stages of the Current Bull Cycle

“The long-term trend remains downward, which suggests that the market is likely to reach its cycle peak by Q1 2025, or at the latest by Q2 2025.” – By @DanCoinInvestor

Full post 👇https://t.co/U6eLo2kUOc pic.twitter.com/qkJArfnbRK

— CryptoQuant.com (@cryptoquant_com) January 6, 2025

He advises investors to be cautious, particularly those with large positions. The market analyst also shared that he plans to start liquidating his holdings. This strategy is aimed at reducing risk while still taking advantage of remaining market opportunities.

Crypto Dan stated:

“However, rather than a single spike, this ratio is likely to rise sharply 2 to 4 times, typically leading to significant overheating followed by a bear cycle. Therefore, expectations for substantial gains in both Bitcoin and altcoins should still be kept open.”

Other Analysts Warn of Potential Challenges for Bitcoin

Other analysts suggest that the market may face challenges ahead. Markus Thielen of 10x Research highlights that the Federal Reserve’s upcoming decisions could significantly impact Bitcoin’s direction. The Federal Open Market Committee (FOMC) meeting later this month may slow down Bitcoin’s momentum.

Our #Bitcoin/Crypto Game Plan for January – This Indicator Signals a BTC Rebound

👇1-12) The crypto trading environment remains mixed following the December FOMC meeting and the subsequent holiday season. However, opportunities for returns persist in specific areas. For… pic.twitter.com/otODXb7GgZ

— 10x Research (@10x_Research) January 5, 2025

Meanwhile, John Glover, Ledn’s CIO, predicts a short-term correction for Bitcoin, possibly falling to $89,000. However, he expects it to rebound and surpass $125,000 later in the quarter.

Crypto Set for Positive Developments This Year

Many crypto industry experts believe that Bitcoin will see significant growth this year. One factor behind this optimism is the inauguration of U.S. President Donald Trump. His administration is expected to promote Bitcoin adoption through various initiatives.

Analysts at Steno Research predict that this year will be crypto’s best year yet, with both Bitcoin and Ether likely surpassing all-time highs. They anticipate other “remarkable positive developments” as well. Moreover, Asset manager VanEck expects the crypto bull market to reach a “medium-term peak” in Q1 2025 before soaring to all-time highs by the end of the year.

Bitcoin surged 131% in a year, peaking at $108,135 in December. At the time of writing, BTC was trading at $101,689, reflecting a 2.39% increase in the past 24 hours.