Bitcoin (BTC) prices during the coldest winter in cryptocurrency history have been very discouraging for investors. In specific points, prices were lower than almost five years ago. However, this does not mean that the price of Bitcoin is degrading if we move away.
If we look at the significant price declines and recovery rates of Bitcoin throughout its history, it is clear that Bitcoin made new highs at the end of each bear cycle.
The current price of Bitcoin stands at around $19,300, which is about 72% of its all-time high (ATH) recorded on November 10, 2021, at $69,045. However, this change can be said to be relatively normal. for Bitcoin as it dropped around 75% to drop as low as $17,600 in June 2022.
Bitcoin: ATH price reduction (Source: Glassnode)
As you can also see in the chart above, the same drop of 75% or more was also recorded in 2011, 2015, 2019 and 2020. These changes indicate a significant amount of volatility. However, Bitcoin price prevailed each time and rallied to record new highs.
Bitcoin price broke its infamous $20,000 support in late August 2022. $20,000 was the ATH point of the 2017 bull run. Breaking the peak of a previous bull run is something Bitcoin has never done before, it That could stir investors.
Is $20K the correct benchmark?
In fact, $20,000 was recorded as the 2017 bull run ATH. However, upon closer examination, it becomes apparent that the price of Bitcoin was only $20,000 for a couple of hours. The average price of the peak of the 2017 bull run was between $8,000 and $10,000.
For the years 2018 to 2020, on the other hand, the average price is just above $8,000. The maximum price level on December 17, 2017 was $20,000. This lasted for a short couple of days, and the price returned to $10,000 in early January 2018.
As a result, the average price between 2018 and 2020 seems to be almost $8,800, which would be the correct benchmark to consider.
The 360 day moving average chart for Bitcoin shows that the price of BTC does not deviate much from the 360 DMA from 2018 to 2020.
Bitcoin daily moving average (Source: Glassnode)
The $20,000 price high in December 2017 appears on the chart above as a significant break from the 360 DMA. This deviation indicates that the price of Bitcoin was artificially pumped to reach $20,000.
Looking at the average price and year-end 360 DMA of 2017, it is clear that Bitcoin returned to its average price range of about $10,000 or so after the effects of the bomb wore off.
Less than $10,000 to $20,000
All things considered, claiming that Bitcoin’s current trajectory is doomed just because it broke the previous bull run’s ATH by falling below $20,000 is not entirely true.
The $20,000 price level reached after an artificial pump can be registered as ATH at that time. However, the data indicates that the average price in 2018 was between $8,000 and $10,000.
Considering that the price of Bitcoin is hovering around $20,000 today, this indicates a two-fold increase compared to 2018.
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This post Is the price of Bitcoin lower than it was 5 years ago or has it doubled?
was published first on https://cryptoslate.com/bear-market-cycles-is-bitcoin-price-lower-than-5-years-ago-or-has-it-doubled/