State of the Crypto Market – The Money Jungle

The cryptocurrency market has seen a new bull cycle in recent months, with many investors and enthusiasts anticipating significant gains. In this article, we explore the potential causes of the new cryptocurrency bull cycle, its leading indicators, and the leading coins to watch. We also discuss the risks and challenges that investors should be aware of and provide a future outlook for the market.

A bull cycle in the cryptocurrency market is characterized by a sustained period of rising prices and investor optimism. Previous bull cycles in the market have resulted in significant gains for investors, with some cryptocurrencies increasing in value by thousands of percent. The current bull cycle, which began in late 2020 and has continued into 2021, is expected to see similar gains.

One of the potential causes of the new cryptocurrency bull cycle is institutional adoption of cryptocurrencies. In recent years, many large financial institutions, including banks and hedge funds, have started to invest in cryptocurrencies. This institutional adoption has brought increased legitimacy to the cryptocurrency market and has attracted more investors.

Another potential cause of the new cryptocurrency bull cycle is the increased mainstream acceptance of cryptocurrencies. More merchants and businesses are now accepting cryptocurrencies as a form of payment, which has increased their utility and demand. This acceptance has also led to increased public awareness and interest in cryptocurrencies.

Economic and political instability in certain regions has also been cited as a potential cause of the new cryptocurrency bull cycle. In countries with hyperinflation or currency devaluation, cryptocurrencies have become a viable alternative to traditional currencies. Additionally, some investors may see cryptocurrencies as a safe haven asset during times of economic uncertainty.

Venezuela: Venezuela has been experiencing hyperinflation for several years, with annual inflation rates reaching as high as 9,000%. The country’s political and economic instability, coupled with heavy reliance on oil exports, has led to a collapse in the value of the local currency, the bolívar.
Zimbabwe: Zimbabwe experienced hyperinflation in the late 2000s, with annual inflation rates reaching as high as 500 billion percent. While the country has since stabilized its economy and adopted the US dollar as its official currency, there are still concerns about the country’s long-term economic prospects.
Iran: Iran has also experienced hyperinflation in recent years, with annual inflation rates reaching as high as 42%. The country’s economy has been affected by international sanctions and political instability, which have contributed to the devaluation of the local currency, the rial.
Lebanon: Lebanon has been experiencing hyperinflation since late 2019, with annual inflation rates reaching as high as 84%. The country’s economic and political crisis, coupled with the impact of the COVID-19 pandemic, has led to a collapse in the value of the local currency, the Lebanese pound.

The Bitcoin halving (see related story Bitcoin Halving), which occurred in May 2020, is also seen as a potential cause of the new cryptocurrency bull cycle. The halving, which reduces the rate at which new bitcoins are created, has historically led to an increase in the price of Bitcoin. This is because the reduced supply of new bitcoins makes them more scarce and therefore more valuable.

Leading indicators of the new cryptocurrency bull cycle include an increase in trading volume and market capitalization. The cryptocurrency market has seen record trading volumes and market capitalization in recent months, indicating strong investor demand. Rising prices of leading cryptocurrencies, such as Bitcoin and Ethereum, are also a key indicator of the bull cycle.

In February 2021, Tesla announced that it had invested $1.5 billion in Bitcoin and would start accepting Bitcoin as a form of payment for its products.
In March 2021, Morgan Stanley announced that it would offer its wealth management clients access to Bitcoin funds.
In May 2021, BNY Mellon, one of the world’s largest custodian banks, announced that it would start offering cryptocurrency custody services to its clients.
In June 2021, Goldman Sachs launched a cryptocurrency trading desk and started offering Bitcoin futures trading to its clients.

Growth in new users and accounts is another leading indicator of the new cryptocurrency bull cycle(see related story Bitcoin is the new GOLD). Many cryptocurrency exchanges have reported a surge in new account registrations, indicating increased interest in cryptocurrencies. Positive sentiment in social media and news outlets is also a leading indicator, as it reflects the overall market sentiment and can influence investor behavior.

Bitcoin remains the leading cryptocurrency in the market, with a dominant share of the market capitalization. Ethereum is also a leading cryptocurrency to watch, as it has shown significant growth potential in recent months(see related story is ETH just like BTC). Other leading cryptocurrencies, such as Litecoin and Bitcoin Cash, are also worth watching.

Investors should be aware of the risks and challenges during the cryptocurrency bull cycle. Volatility and fluctuations in prices are common in the cryptocurrency market, and investors should be prepared for significant price swings. Regulatory uncertainty and government intervention are also potential risks, as some governments have taken steps to restrict or ban cryptocurrencies. Security and fraud risks, such as exchange hacks and scams, are also a concern for investors.

In conclusion, the new cryptocurrency bull cycle is an exciting time for investors and enthusiasts in the market. The potential causes of the bull cycle include institutional adoption, increased mainstream acceptance, economic and political instability, and the Bitcoin halving. Leading indicators of the bull cycle include an increase in trading volume and market capitalization (see