This undefeated crypto signal just flashed green
Something very important happened last month.
Bitcoin reached new all-time highs. This is one of the best crypto signals out there.
New all-time highs mark the beginning of the “euphoria” phase of the crypto bull market.
Although I don’t own BTC, it remains a bellwether for crypto assets. If bitcoin is doing well, the market is likely following. Bitcoin rose 147% over the past year. Many cryptocurencies have jumped even more:
Avalanche (AVAX): 198%
Render (RNDR): 618%
Solana (SOL): 837%
Etc.
From studying past market cycles, we know new highs are an extremely important crypto signal.
Fresh highs usually kick off the most profitable part of the bull market, which typically lasts 6–12 months, as this chart shows:
Source: Glassnode
All the metrics I’m watching tell the same story: We’re just now entering the “euphoria” phase, and things are about to accelerate.
I was recently in London meeting with a few friends who run hedge funds. One of them said, “There is the pre-all-time-high market, and the post-all-time-high market.”
All-time highs matter for a few reasons:
- Every major news outlet starts covering crypto again.
- The people who called crypto a “scam” go quiet because scams do not recover. Dutch tulips never bounced back to new highs.
- They act like a “bat signal” shining in the night sky telling everyone, “Crypto is back” — and the tourists soon flood back into the market.
Just like Louis Vuitton handbags, crypto is a “Veblen good.” Named after economist Thorstein Veblen, these items become more desirable as their prices increase. More people are interested in buying BTC at $70,000 than at $16,000.
This is great for investors like us who bought crypto assets at much lower prices. We’ll sell tokens to new entrants at much higher prices over the coming months and years.
For now, I predict Bitcoin will reach $150,000 in 2024.
But it’s not my preferred crypto to buy…
I prefer to own crypto businesses with real products producing real revenues. Ethereum (ETH), which is outperforming bitcoin this year, is one of them.
I’ll have more to say about Ethereum in 2024 and other crypto signals I’m watching (like the halving) in my investing letter The Jolt⚡.
I publish a new Jolt issue every Monday/Wednesday/Friday.
