Learn Live ICYMI: Bull Run Breakdown
Recently, Bitcoin reached a monumental milestone by passing the $100,000 barrier. This highly anticipated event bolstered crypto wallet balances, but at the same time, it leaves some investors and traders wondering how long the rally will continue — and what’s fueling it.
In the sixteenth episode of our Learn 101 livestream, we uncover the Bull Run Breakdown.
Our series, Learn Live ICYMI, provides a recap of our Learn 101 livestreams, offering you comprehensive expertise and insights from leading figures in the crypto industry in case you miss the livestream.
Joining the livestream on Dec 6, 2024, were three distinguished guests: Eamonn Gashier, Founder and CEO of Block Scholes; Andrew Melville, Head of Research at Block Scholes; and Echo Peng, Bybit Earn Product Manager. Under the moderation of Sabrina Chua, Crypto Evangelist and SEO Editor at Bybit, this episode explores the Bull Run Breakdown.
Key Takeaways:
The current Bitcoin rally is being driven both by halving and recent adoption by institutional investors.
Institutional investor activity is also driving up the prices of other coins, and may minimize the depth of the bear market as the cycle continues.
Other Layer 1 coins, such as XRP and ETH, are poised for continued growth, as they’re in price discovery and utility discovery phases.
Pulse of the Market — What's Fueling the Surge?
In the first segment, Andrew Melville points out that crypto has steadily become part of the broader macro asset class, with institutional investors gaining easier access through products such as crypto ETFs. This shift has increased crypto's correlation with U.S. equities. Back in 2020 crypto activity surged, but it was largely driven by retail investors stuck at home during COVID-19 lockdowns, who had more time to explore this space.
Despite Ethereum’s underperformance over the past few years, Andrew notes that Bitcoin spot activity has been unexpectedly strong. He believes that Ethereum and other Layer 1 cryptos could outperform in the current market, especially given broader trends such as the influence of elections on the crypto space. These crypto assets are increasingly being viewed as solid long-term investments.
Eamonn Gashier describes today’s market sentiment as strongly bullish, noting that this cycle feels different from past ones. He calls it a "perfect storm" driven by Bitcoin halving, easing of monetary policy and the introduction of crypto ETFs. While Bitcoin typically leads during such cycles, new dynamics — such as the sharp turnaround in U.S. crypto sentiment — make the crypto market’s trajectory harder to predict.
The usual pattern, in which altcoins rally as Bitcoin cools, is also less clear. Eamonn highlights the fact that institutional buyers stepping in during Bitcoin dips have helped stabilize its price, making it less likely that money will flow into altcoins as before. He remains optimistic about crypto’s upward trend, but acknowledges that the market is still figuring out its value, which adds an element of uncertainty.
Echo Peng shifts the focus to stablecoins, which have hit an all-time high in market cap. Ethena’s synthetic dollar, for example, is gaining traction, sitting just behind USDT and USDC and offering up to 29% returns. She advises investors to diversify their stablecoin portfolios, and mentions that platforms such as Bybit provide opportunities to profit during a bull run, including options like mining and dollar-cost averaging.
Deep Dive Into the Top Trending Coins In the Past Month — Analyzing Current Giants
XRP recently surpassed Solana and USDT in market cap, driven in part by speculation surrounding a potential XRP ETF. Andrew Melville views XRP’s prospects as highly promising, noting that coins previously held back by SEC scrutiny are now making significant comebacks. He describes how these developments reflect the broader evolution of stablecoins and the democratization of access to the U.S. dollar. However, Melville acknowledges that stablecoins lack the high returns that institutional investors typically seek.
Eamonn Gashier shares insights on the impact of Bitcoin Spot ETFs, observing that Bitcoin initially experienced a bullish run before leveling off as the market became saturated. A similar trajectory was expected for Ethereum Spot ETFs, but their delayed response has only begun to manifest in recent weeks.
Gashier notes that the evolution of coins such as XRP has been surprising, and has sparked a surge in derivatives trading. The market is currently navigating both price discovery and utility discovery. For instance, if new utility is found for XRP, it could drive an unexpected price surge. He also points out that XRP is widely used in several countries, where it addresses gaps in the utility of local currencies.
Echo Peng shifts the conversation to the challenges cryptocurrencies face in attracting retail users. She highlights Telegram as a game-changer, emphasizing its simplicity and efficiency since it eliminates the need for app downloads. Other social platforms, such as TikTok and X/Twitter, are also key drivers of user engagement, showcasing the way social media has become central to crypto adoption.
Andrew Melville adds that other cryptocurrencies, such as Sui (SUI) and Solana (SOL), offer distinct utilities, particularly in the gaming space — an area where some projects fall short. Solana in particular has seen renewed demand during the current bull run, which could strengthen its position against competitors in the long term.
As for Dogecoin (DOGE), Melville notes that its growth is currently limited by market fundamentals. He highlights factors shaping its market, such as improvements in price discovery mechanisms and declining volatility. These trends are also apparent across many altcoins, which now feature increasingly vibrant options markets, reflecting their maturation as financial instruments.
Strategic Playbook — Maximizing Returns During the Rally
Derivatives serve as a crucial safeguard in volatile markets. Gashier explains that tools like options and futures act as a form of insurance, enabling investors to hedge against potential losses. For instance, long-term investors such as pension fund managers typically avoid selling during strong markets. Instead, they purchase put options to lock in profits while maintaining their positions.
He also highlights the growing role of structured products in the crypto ecosystem. These instruments offer the potential for higher yields by leveraging optionality based on market outlooks. For example, by writing a call option, investors can earn yields on their holdings. Although relatively new to the crypto space, structured products are gaining traction, and Gashier is optimistic about their expansion over the next couple of years.
Melville adds a reminder to balance returns with risk management. Diversification, he emphasizes, is key to mitigating exposure. While options are a valuable tool for managing risk, he points out that there are various other strategies available. Investors and traders should explore and adopt solutions that align with their unique goals and risk tolerance.
Closing Thoughts
This session of the Learn 101 livestream effectively highlighted the Bull Run Breakdown. With several new factors influencing the bull run, this is an exciting time for investors and traders.
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