Bitcoin (BTC) Price Analysis: 2025 Bull Cycle Aligns with Preceding Cycles, but This Time the Market Looks Different

Analyst Master Kenobi highlighted a Bitcoin chart outlining key moments from the first phase of the 2021 bull market.

Key Takeaways

Bitcoin rose 140% off its 2017 high by January 30, 2021, fueled by post-halving momentum.

In 75 days, it saw three blow-out rallies, only for its gains to be wiped out in the sell-off during the summer, falling 54%.

But history teaches us that these down periods serve as a launchpad for the next leg of a bull market.

2025 aligns historically with the previous bull cycles, with one caveat: no internal danger is looming over the crypto economy in 2025.

Institutional adoption is ramping up, with Bitcoin and Ethereum ETFs already live and more altcoins potentially in line.

If patterns from past cycles continue, February could mark the start of a new explosive phase for altcoins.

Bitcoin’s Leverage Balance: A Window Into Market Sentiment

CryptoQuant data shows that Bitcoin’s Estimated Leverage Ratio (ELR) is a key metric for gauging trading confidence and, by extension, the overall trading risk appetite. As Bitcoin’s price rose in 2021, so did its leverage, indicating increasing confidence. High leverage usually leads to sharp liquidations and, hence, rapid price drops.

Meanwhile, as Bitcoin entered a downtrend in 2022, its leverage ratio dropped as investors reduced their exposure. This is a common trend, suggesting that Bitcoin’s volatility is partly driven by leverage. Currently, the ELR values indicate that investors are being cautious and waiting for a directional move.

ETF Approvals: A Game-Changer For Crypto Markets

Unlike its predecessors, the current bull run is a sea change with its attendant green lights from regulators, opening up the institutional floodgates into crypto. The legitimacy of institutional investors can make a sustained bull run, marking 2025 different from its predecessors.

As we await ETFs for altcoins, the times they are a-changin’. With even larger assets like Solana and XRP getting ETF approval, a new wave of capital could enter and reshape the market. Compared to the unhinged mania of 2017 or the institutionality of 2021, this one seems more measured, opening up the space for long-term growth.

Market cycles tend to repeat, but with new elements at each stage. History tells us that Bitcoin is in the next phase of a bull market, but external factors like macroeconomics and regulators will influence its trajectory.

If past trends continue, early February could mark the start of a rapid price expansion phase. However, investors should proceed with caution as heightened speculation will usher in a period of market volatility.