On average, crypto bear markets last about a year, sometimes extending to two, when supply surpasses demand causing prices to decline. One of the most severe bear markets was in 2022 with the collapse of FTX, leading to further industry downturns.
Recent concerns about the market heading into another bear phase arose with Bitcoin hitting $73,750 and then declining. This situation has led some to suggest a cyclical downturn, examined through market cycle psychology charts showing stages like disbelief, euphoria, and anxiety.
Recently, Bitcoin long-term holders have avoided selling, indicating potential investor patience. This suggests that the anticipated bear market might be distant. However, Ethereum’s underperformance serves as a counterpoint, with its price dropping significantly from its all-time high.
Despite concerns, actions by crypto whales and metrics like the Net Unrealized Profit/Loss (NUPL) suggest caution. The reading of NUPL shows investor profit levels; a significant decrease in NUPL could indicate a bear phase.
At press time, the NUPL stands at 0.46. If it continues to decrease, Bitcoin’s price could fall to $40,000, potentially marking a market downturn.
