Welcome to Bitcoin
In the distant past — and by that I mean, February 1st 2024 — Bitcoin was at $42,000. Then several eons elapsed — and by that I mean, 28 days — and Bitcoin found itself cruising over $61,000. It's February 29th as I write this and the price briefly touched $64,000 before retracing to the mid-$61k range. Analysts, short sellers, and those folks still waiting for $12k shook their heads in collective disbelief. Even the survivors of previous cycles couldn’t quite wrap their heads around the velocity. It wasn’t just the overall size of the jump — it was the fact that the last $10,000 leap occurred over just 48 hours.
A 10% leap in a single day is impressive, but if it feels like you’ve seen this movie before, it’s because you have. Many times, in fact. If you look at the last 8 years worth of daily Bitcoin prices, you’ll find exactly 50 instances where the price jumped by at least 10% from one day to the next. Within those 50 days, nine days saw jumps greater than 15%. Within those nine days, exactly 2 days exhibited 20% gains. Both of those magical moments happened in 2017: the first was on June 20th, when $BTC went from $2270 to $2900, and the second was on December 17th, when it went from $14200 to $17800.
But of course, the converse is also true. From 2016 onwards, there have been 36 days where the Bitcoin price dropped greater than 10% from one day to the next. Interestingly, there was only one instance where it dropped greater than 20%, and that was much more recently. Between March 12th and 13th, 2020, Bitcoin sank like the Titanic from $7913 to $4970 ... a heartstopping 37% crash. Two years hence and we still refer to the moment as Black Thursday, triggered by the global COVID panic.
You may be thinking, surely this is volatility from the old days. Bitcoin has stabilized so much more in recent years, right? That’s not entirely accurate. Looking at the numbers, we find that bull market years (2017, 2021) show an average daily volatility of between 2.8% and 3%, whereas all other years are between 1.4% and 1.9%. (When I say the “average daily volatility,” I mean that the price could go either up or down by around that much from one day to the next.) We don’t have enough data to be conclusive about 2024 yet, but based on the 60 days we have so far, we’re approaching 2%.
It’s interesting to note that although Bitcoin has not broken its true ATH of $69,044 yet, it has actually already broken its ATH against the Philippine Peso. On November 10th, 2021, the PHP exchange rate was 50.4 to a dollar, meaning that the equivalent Bitcoin ATH price was PhP 3,479,817. We broke that just a few hours ago when we hit PhP 3,600,000+ or the $64,000 equivalent. Throughout the Southeast Asian region (and likely the rest of the developing world), Bitcoin has been breaking its ATHs against local currencies this week, because these secondary fiats have all taken a massive beating against the USD over the last 3 years.
So does this put us in a bull market yet? In the midst of all the commotion, we might have missed that a lot of other coins are rallying too. Ethereum itself is up 55% this February. $BNB remembered that it existed and is up 30%. $UNI is up 60%, $APT up 35%. $PRIME is up 97%. In general, there have been a lot of winners, just 60 days into the year. And of course when we step out of the crypto world, it does appear that everything else is going up as well. Big tech like Nvidia, Meta, and AMD are are all up by double-digits, but there are chunky gains in other sectors: notably, the leading weight-loss pharma Eli Lilly is up nearly 50% so far this year.
Given all of these signals, I have to concede that the bull market is here … much, much earlier than expected. In previous cycles, the Bitcoin halving triggered a pump several months after the fact. 2024 is the only time the rally has ever begun over a month before the “inciting” event itself. But then again, 2024 is a year in which we’re seeing a confluence of macro factors all working together. There’s the aforementioned halving, but it’s the intense growth of the Bitcoin ETFs coupled with easing Fed interest rates that are driving the markets to a feeding frenzy.
We all need to remember though that just because the bull market has begun, doesn’t mean that there won’t be any more big corrections over the coming months. In the 2017 bull market, we saw seven days with drops greater than 10%, and in 2021, we saw five. There’s still ten months left in 2024, cryptofam, so be vigilant and stay sharp!
PS. If you found this newsletter useful, please do me a favor and check out GCrypto in your GCash app. (Look inside the GInvest folder!) We’re the easiest way to buy your first small BTC stash and we’d love to have you on this journey.