Pantera Capital on Bitcoin: We’re in the Next Bull Cycle
The February Blockchain Letter was published last week by Pantera Capital. The letter, titled “The Seventh Bull Cycle,” is written by founder and managing partner Dan Morehead and investment associates Ryan Barney and Sehaj Singh. Pantera Capital is an investment firm that specializes in cryptocurrencies and digital assets and blockchain technology. Contextualizing his analysis of the bitcoin price gyrations at the firm, Morehead tweeted on Thursday that according to him, the blockchain asset has definitely seen an uptrend (using bitcoin as a proxy), while we head into the next bull market. Irrespective of what happens in the interest rate sensitive asset class.
He also said that this will be the seventh bull cycle during the 6 bear cycles. The letter goes on to explain that Pantera has been through 10 years of bitcoin cycles and has traded in a similar fashion through 35 years of cycles.
The founder of Pantera Capital points out that the drop in the price of bitcoin from November 2021 to November 2022 was definitely an average of the typical cycle, and he also says that this is the only bear market that completely wipes out the previous bull market. And in this case gives back 136% of the previous rally. The average downdraft has been 307 days while the bear market was 376. The average drawdown has been a downdraft of -73% and the latest bear market ended at -77% and they seem to be done with that and are looking for higher upside potential. He further states that over the long term, the price of bitcoin has been in an average 2.3x annual growth trend over the past 12 years.