Bitcoin may see another 5 – 6 months of downward or sideways price movement – grayscale report.

In short:

• The team at Grayscale has predicted that Bitcoin may see another five to six months of downward or sideways price movement.
• The Grayscale team cites the traditional 4-year Bitcoin and crypto cycle as the basis for the conclusion.
• The team also highlighted an increase in the number of wallets by 0.001 – 0.01 BTC, 0.01 – 0.1 BTC and 0.1 – 1 BTC.

A team of analysts from Grayscale has released a report analyzing the ongoing market for bitcoin and cryptocurrencies.

Bitcoin may see another 5-6 months of downward or sideways price movement.

The report begins by taking a deep dive into the popular four-year Bitcoin and crypto market cycles, which are usually in line with the BTC halving event. According to the Grayscale team, the 4-year cycles take about 1275 days.

They pointed out that “the 2012 and 2016 cycles lasted for about 4 years, or 1290 and 1257 days, respectively.” In addition, from each peak to a bottom, Bitcoin took 391 days to fall 73% in 2012, and 364 days to fall 84% in 2016.

In addition, and using a similar analysis, the current 2020 cycle is about 1,198 days in, and Bitcoin probably has another five to six months to find a possible bottom. They explained:

In the current 2020 cycle, we are 1198 days in from July 12, 2022, which may represent another approximately four months left of this cycle until the realized price crosses over the market price.

Bitcoin is 222 days away from the all-time high, which means we can see another 5-6 months of downward or sideways price movement.

Market bottoms appear to appear a month earlier with each cycle.

Furthermore, the Grayscale team observed that with each market cycle, a Bitocin and crypto bottom tended to arrive a month earlier than expected.

Bitcoin wallets with 0.001 – 0.01 BTC, 0.01 – 0.1 BTC and 0.1 – 1 BTC have increased.

In terms of data on the chain, the Grayscale team noted an increase in Bitcoin addresses by 0.001 to 1 BTC. They explained that an increase in the number of such addresses resulted from investors taking the bear market as a signal to accumulate more Bitcoin. They said:

Many of these [Bitcoin] outflows [from exchanges] may be due to investors using this opportunity to increase their position sizes at a discount.

The number of wallet addresses with .001-.01 BTC, .01-.1 BTC and .1-1 BTC has increased sharply, reaching new records.

This marks an interesting change in market sentiment as smaller investors have historically reduced their position size in times of uncertainty – especially in 2018 after the price of Bitcoin fell from ~ $ 20k.