The CEO and founder of on-chain analytics firm CryptoQuant has explained how this bitcoin bull cycle could likely last until mid-2025.
Profit-taking by former bitcoin whales lasted 18 months in previous cycles
In a new x.com/ki_young_ju/status/1816895299237085548″ target=”_blank”>mail At x, CryptoQuant founder and CEO Ki Young Ju talked about a pattern that old whales have followed in terms of profit-taking over the past cycles.
“Old whales profit during bull markets,” Young Ju notes. “Their sales bring new capital into accumulation addresses, which increases realized prices.” Accumulation addresses refer to bitcoin wallets that have no history of selling.
These addresses also have a few other conditions, such as they must have at least two deposits and must not be connected to centralized miners or exchanges. They must also have a balance of at least 10 btc and their last transaction must have been within the last seven years.
Accumulation directions basically reflect the perennial HODLers of the market, who only buy more and never sell. During bull markets, when old whales break their silence to reap their profits, the demand from these HODLers absorbs the selling.
To illustrate this trend, CryptoQuant’s CEO has made use of the “Realized Price” metric, which tracks the cost basis of the average investor belonging to this cohort.
When the value of this indicator is above the spot price of the cryptocurrency, it means that the cohort as a whole is in a state of unrealized loss at the moment. On the other hand, if it is below the value of btc, it implies that these diamond hands are making profits at the moment.
Now, here's a chart showing the trend in realized price for bitcoin accumulation addresses over the past decade:
<img src="https://technicalterrence.com/wp-content/uploads/2024/07/Bitcoin-bull-cycle-could-continue-until-mid-2025-says-CryptoQuant-CEO.jpeg" alt="bitcoin Accumulation Address Realized Price” />
As shown in the chart above, the realized price for this cohort saw an increase during the last two bitcoin bull runs. This would suggest that these HODLers were buying as prices rose, which pushed up their average cost basis.
This accumulation was likely due to profit-taking by other market entities. As Young Ju pointed out, this profit-taking spree lasted for about 18 months in the last few cycles.
The chart shows that the indicator has returned to an uptrend with this year’s price rally. This would suggest that accumulation directions are once again absorbing profit-taking from former whales.
So far, this surge has lasted for around four months, meaning there could still be around another fourteen months left, if we go by the last two cycles. Based on this, the analyst believes that this latest bitcoin bull cycle could end up extending until mid-2025.
btc Price
bitcoin approached the $70,000 level over the past day after seeing an increase of around 3%.
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