Bitcoin has been in a consolidation phase since hitting an all-time high of $73,777 in mid-March. Since then, Bitcoin’s daily closing prices have shown a great deal of restraint, never closing above $71,500 and holding below $54,000, although it did see an intraday low of $49,000. This consolidation phase has pushed the Fear and Greed Index toward a cautious “fear” score of 30, revealing an atmosphere of fear among traders who often find themselves caught in the crosshairs of volatile market dynamics.
Is $60k the new price for $10k for Bitcoin?
Despite the market jitters, some market experts see this as a potential buying opportunity, reminiscent of similar market conditions seen in 2019. Bloomberg ETF Expert James Seyfarth Note Via X: “Bitcoin’s current price of around $50k to $70k over the past six months is somewhat reminiscent of Bitcoin trading around $7k to $10k from mid-2019 through early to mid-2020.”
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Seyfart acknowledges the complexities of comparing historical and current charts, emphasizing that while historical patterns should not dictate future outcomes, comparative dynamics offer insightful parallels. “Obviously, I shouldn’t equate historical charts with current charts,” Seyfart said. “I know all the differences in current price dynamics and so on. $10,000 was a lot further away from the all-time high of over $20,000 than $60,000. But don’t make fun of me. I can live with that.”
James “Checkmate” Cheek, a leading blockchain analyst and co-founder of CheekConchain, agreed “The similarity between the consolidation process we saw in 2024 and the one we saw in 2019 is strange and surprising,” Seifert notes.
In 2019, the market surged from $4,000 to $14,000 in three months, largely driven by the PlusToken Ponzi scheme in China, which sucked up nearly 2% of the total circulating Bitcoin supply at the time. This was followed by a mass sell-off of these coins acquired on Huobi by the Chinese Communist Party, which contributed to prolonging the market volatility until the sharp decline in March 2020.
By comparison, Cheek notes that a similar sequence occurred in 2024 when the market rallied from $40,000 to $73,777, driven by a massive spike in spot bids from U.S. spot ETFs, which absorbed about 5% of the bitcoin supply. This was followed by massive sell-offs from the U.S. and German governments, involving about 70,000 bitcoin, which contributed to continued market volatility until the yen carry trade unraveled on August 5.
“Seriously, it’s really uncanny how similar these events are, and that’s just based on the main events. There’s more evidence under the surface,” Chick concluded. He shared several on-chain metrics that highlight the strong similarities.
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His chart “General Supply Expenditures During the Consolidation Period in 2024” showed that the total spent coins older than one year over a 6-month period was quite similar to historical movements. In 2019, 1.75 million bitcoins were moved by this group; similarly, in 2024, as of today, 1.9 million bitcoins were moved. Notably, large entities, including the Grayscale Bitcoin Trust (GBTC), the German government, and the US government, were responsible for approximately 454,000 bitcoins of this movement.
Additional data from Check’s analysis highlights the “profits made” during these periods. In 2019, 3.4 million BTC were sold for a profit over a six-month period. In 2024, that number will reach 3.33 million BTC.
However, an analysis of realized losses provides a stark contrast between the two periods. In 2019, losses were 30% of profits, indicating a market fraught with fear among investors and a willingness to sell at a loss. In contrast, in 2024, losses represent only 10% of profits. This comparison illustrates how market sentiment has shifted from 2019 to 2024, with investors in 2024 appearing more confident and less likely to panic sell.
At the time of publishing this report, BTC was trading at $59,689.
Featured image created using DALL.E, chart from TradingView.com