Reviewing History: Bitcoin may hit a new high this year!

CCData's research report released on Tuesday stated that Bitcoin has not yet reached the peak of the current appreciation cycle and may surpass its historical high this year.

Data shows that Bitcoin hit a historical high of over $73,700 in March this year, but has been fluctuating between around $59,000 and $72,000 since then. The record high in March was mainly due to the approval and launch of spot Bitcoin ETFs in the United States in January. According to CCData, these funds have attracted approximately $14.41 billion in net inflows to date.

Spot Bitcoin ETFs allow investors to purchase products that track the price of Bitcoin without owning the underlying cryptocurrency. Cryptocurrency supporters say this helps legitimize this asset class and makes it easier for large institutional investors to participate.

It is reported that the Bitcoin "cycle" refers to the period after the digital currency reaches a new high and then falls back into a bear market or "crypto winter." Since the launch of Bitcoin, this cycle has been completed three times, usually following a similar pattern centered around the "Bitcoin halving" event, during which miners' rewards are halved, reducing the supply of Bitcoin in the market.

Usually, the halving event occurs a few months before Bitcoin sets a new high within the cycle. However, the current cycle is different as Bitcoin reached its latest historical high before the halving event due to the optimism brought by spot Bitcoin ETFs.

Currently, as Bitcoin fluctuates within a range after hitting a historical high, many question whether Bitcoin has reached the peak of the current cycle.

However, CCData's report, through studying Bitcoin's historical price trends, believes that Bitcoin can still reach new highs. According to the report, historical trends show that the halving event always heralds the arrival of a period of price expansion, which may last from 366 days to 548 days, "each halving cycle is longer than the previous one before reaching the peak of the cycle, due to the maturity of the asset class and the decrease in volatility."

The report states that the last Bitcoin halving occurred on April 19 this year, so the price expansion period has not yet passed.

"Furthermore, we observe that in the previous cycles, centralized exchange trading activity decreased almost within two months after the halving event, which also seems to be reflected in the current cycle. This indicates that the current cycle may extend to 2025," CCData said.

The report acknowledges that the "impact of institutional participants in the industry" has "changed previous trends" in the current cycle, and adds that low trading activity may occur in the third quarter, which in turn may imply more lateral price movements.

"However, the data and previous trends are strong enough to suggest that any lateral price movements are temporary, and we may break previous historical highs again by the end of this year."

The report also stated that the upcoming Ethereum ETF in the United States and similar products worldwide "are destined to bring more capital, liquidity, and demand to this asset class." Another important historical data supporting the CCData view is that the price of Bitcoin has risen in a relatively short period of time. For example, in the 2012 cycle, during the period from halving to hitting the historical high, 91.4% of the increase occurred in the four months before the peak of the cycle. In the four months before hitting the historical highs in the 2016 and 2020 cycles, the proportion of the total increase was 78.8% and 71.5% respectively.

"There has not been this parabolic expansion in the current cycle," CCData stated.

However, some analysts also point out that although there are historical patterns in the trend of Bitcoin, there is currently no signal triggering new highs. Thomas Perfumo, Strategic Director at the cryptocurrency exchange Kraken, said that historically, market cycles peak 12 to 18 months after Bitcoin halving, with the last halving occurring in April this year. We have not yet seen volatility reach previous peaks. Finally, previous market cycle peaks coincided with rapid consecutive new highs—10 to 20 new highs within 30 days—but we have not triggered any of these signals yet."