The cryptocurrency winter may be coming to an end, according to the Morgan Stanleywho published a bullish article on Bitcoin.
“Based on current data, signs indicate that cryptocurrency winter may be over and spring is about to begin.”according to the article from one of the largest investment banks in the world.
The cryptocurrency market is often characterized by alternating periods of euphoria and cutbacks. These phases are occasionally referred to as ‘spring’ and ‘winter’ respectively.
It’s important to note that cryptocurrency winter isn’t just about lower digital asset values; it is also lower total trading volume over a long period of time
According to the bank’s research, there are concrete indications that the current crypto winter, which has lasted since the end of 2021, may finally be a thing of the past.
Bitcoin spring is just around the corner
Morgan Stanley notes that in previous winters, Bitcoin’s time has lasted 12 to 14 months after price peaks. The cryptocurrency reached an all-time high of around $69,000 in November 2021 and bottomed out a year later.
“A 50% price increase from Bitcoin’s low is usually a good sign that the bottom has been reached”, wrote strategist Denny Galindo. The world’s largest cryptocurrency is up 70% year to date and up 77% from last year’s low.
The bank also states that most of Bitcoin’s increases occur after the halving, and this “The bullish period begins with the halving and ends when the price of bitcoin reaches its previous peak.”
Halving is an event that happens every four years when the mining reward is halved and this reduces inflationary pressure on Bitcoin.
“By deliberately limiting the supply of new bitcoins, the scarcity caused by the halving could impact the price of bitcoin and potentially fuel a bull run.”said Galindo, adding that it was “three such runs since inception, each lasting 12 to 18 months after the halving.”
The bank adds that, as with any investment, past performance is not indicative of future results. While no one can say whether this is the right time to buy or sell cryptocurrencies, the bank says so “Today is the right time to learn more about cyclical market trends.”
“Potential risks, such as business failures, software bugs, a recession or coordinated government action, could emerge before the expected halving and interrupt the cycle.”
Finally, the bank says that just as a farmer avoids planting seedlings in winter or too late in spring, cryptocurrency investors want to know when spring has arrived to maximize the “growing season” of their investment.
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
