Crypto bull runs explained: Key indicators, history, and strategies

Crypto price movements may seem totally unpredictable, but zoom out on a price chart of Bitcoin (BTC) or Ethereum (ETH) and you’re bound to see periods where the coins consistently climb. When the crypto market posts gains and attracts new investor attention, chances are a “bull market” is starting – or in full swing.

Crypto bull runs are one of the most exciting times for investors who want to capitalize on their gains, but be wary of getting too caught up in the euphoria. Crypto bull markets can pose unique challenges that traders may overlook.

To help you keep a cool head in this market condition, we’ll explain what a bull market is and share tips for trading digital assets with discipline.

What’s a crypto bull run?

A crypto bull run is a sustained period of rising prices across the cryptocurrency market. During these optimistic phases, enthusiasm runs high, and a growing number of investors fuel an indiscriminate “buying frenzy” for digital assets. This surge in activity often correlates with metrics such as higher exchange trading volume and large inflows of capital into the crypto market.

How can you tell when a bull run is starting?

Crypto bull runs happen when multiple factors collide at the same time. Instead of looking for just one signal, informed traders look for several signs a crypto bull run is likely brewing:

• Bitcoin breaks resistance: In past crypto market cycles, Bitcoin has had price highs it’s struggled to break through. For example, the 2017 high of roughly $20,000 USD was a major barrier until Bitcoin shattered it in December 2020, launching the next bull run. Since these resistance levels carry significant psychological weight, breaking through them often triggers a surge of optimism in the market.
• Altcoin momentum: Bitcoin’s rise tends to coincide with the start of crypto bull runs, but smaller altcoins have their time to shine, too. Increased volume on the altcoin and non-fungible token (NFT) markets often signals a maturing bull run as investors take on greater risk.
• Increased trading volumes: A healthy bull market needs robust buying activity to support price surges. When volumes on centralized exchanges (CEXs) spike, it shows genuine demand for digital assets and conviction that this is a broad market surge rather than a random blip or market manipulation from large holders (aka crypto whales).
• Institutional inflows: Major companies putting their money in the crypto market is another sign of confidence. Typically, these entities invest for the long haul, which provides both stability and liquidity to further strengthen a bull run.
• Media hype: More energy in the crypto market spills into media coverage, with more positive stories across news outlets and on social media, further exciting traders and bringing new users into the fold.

Crypto bull run vs. bear market

A bull run is the exact opposite of a bear market or “crypto winter,” which both refer to prolonged periods of falling prices. During downturns, interest in cryptocurrencies fades, and trading volume on crypto exchanges slows significantly. Even well-established projects like Bitcoin trade far below their peak in a bear market.

4 phases of a crypto bull run

Crypto bull runs don’t follow a pre-established timeline, but they often happen in four distinct stages. Keep this framework in mind to get a sense of crypto bull run indicators and strategize accordingly:

1. Accumulation phase: This is a quiet stage where prices are flat with little volume and low interest. Since prices are lower in the accumulation phase, anyone who takes the risk and buys tends to be in a prime position for big gains when a bull run arrives.
2. Early uptrend: The market begins to perk up when big projects like Bitcoin consistently log higher highs and higher lows. As prices steadily creep upward, more traders start paying attention and confidence slowly spreads.
3. Euphoria phase: Whatever catalyst pushes Bitcoin above previous all-time highs typically sends the crypto market into full-blown mania. This is when it seems like prices can defy gravity as trading volume explodes.
4. Distribution phase: As prices overextend, big players sell their shares, triggering price choppiness and market uncertainty. This phase often triggers a cascade of selling pressure that plunges the crypto market back into accumulation.

Examining historical crypto bull runs in context

To better understand how the typical phases of a bull run play out, let’s briefly review historical crypto bull markets and analyze what triggered them.

2013 bull run: Banking crisis and early accessibility

Uncertainty surrounding centralized banking institutions was a major driver for the 2013 Bitcoin bull run. The Cyprus banking crisis – in which the Mediterranean island had to impose a levy on bank deposits to avoid insolvency – increased distrust of centralized banks. This convinced more people of the benefits of decentralization, so they stored some of their wealth in Bitcoin. Plus, trading infrastructure at the time had improved significantly with the addition of convenient, regulated CEXs like Coinbase that served as a softer entry point.

2017–2018 bull run: Ethereum’s rise and ICO hype

Innovation, rather than financial worries, was the major driver of the 2017–2018 crypto bull run. Ethereum’s 2015 launch introduced the concept of automated smart contracts to web3, sparking excitement over decentralized applications (dApps) built on blockchain technology. This revolution spurred a wave of new crypto projects and tokens marketed through initial coin offerings (ICOs). Although many ICOs were scams, there’s no denying they generated immense hype and brought investors into the crypto space.

2020–2021 bull run: Pandemic policies and institutional adoption

The economic disruptions caused by the COVID-19 pandemic – including stimulus policies and rampant inflation – were the direct catalysts for crypto’s bull market in 2020–2021. Institutional interest helped push up markets even further as companies like Strategy (formerly MicroStrategy) added Bitcoin to their treasuries. And El Salvador welcomed Bitcoin as legal tender in 2021, increasing cryptocurrency’s legitimacy on the world stage.

How long does a crypto bull run last?

There’s no way to know how long a crypto bull run will last. Historically, they’ve taken between a few months to a year to play out. For example, Bitcoin surged past its previous resistance at $1,200 in March 2017, reaching nearly $20,000 by January 2018. The 2020–2021 bull run started after a crash in March 2020, broke through resistance in December, and continued until Bitcoin’s peak in November 2021.

While these examples offer some context, past performance doesn’t guarantee future outcomes. You can only know how long a bull market lasts with plenty of hindsight.

When is the next crypto bull run? Crypto bull run predictions

There’s a theory in crypto circles called the “four-year cycle,” which suggests crypto bull runs coincide with Bitcoin’s halvings roughly every four years. During a halving, the Bitcoin Network automatically halves BTC issuance, triggering a supply shock that can increase BTC’s price if demand stays the same or rises.

Although this theory has worked in the past and makes sense from a supply/demand perspective, crypto doesn’t exist in a vacuum. Other macroeconomic factors, such as global liquidity and central bank rate cuts, also shape the crypto market’s performance. Traders can watch for crypto-specific influences, like technological breakthroughs and new laws that could drive further adoption. A bull market only appears when many of these positive forces mix.

Ultimately, it’s impossible to say when the next crypto bull market will be, but the post-Bitcoin halving bull run theory suggests it will happen shortly after the next halving in April 2028. Just keep the rest of the world’s economic state in mind as the date approaches, too.

Crypto bull run strategies: Tips for navigating parabolic moves

It’s essential to plan your strategy well in advance of a crypto bull run to maximize the potential benefits. Defining your goals using the strategies here will help you avoid getting swept away by emotional decisions.

Define realistic price targets

Bull market mania can trick traders into believing prices will rise indefinitely. Avoid losing your investments when the bubble bursts by carefully researching a cryptocurrency’s fundamentals, on-chain metrics, and tokenomics for more realistic price expectations.

Resist the urge to FOMO buy

The fear of missing out (FOMO) peaks during bull phases as more influencers and projects pump their favorite coins. To avoid falling for this temptation, recognize that you aren’t getting a “deal” for digital assets. There may still be opportunities to profit, but sticking to a predefined investment plan minimizes the risk of paying a premium for tokens.

Use risk management tools

Automated tools like stop-losses and take-profit orders run on predetermined exit points. These features ensure trades align with your strategy and run in the 24/7 crypto market, so there’s no need to monitor for big moves overnight.

Consider tax implications

Before you finalize your profits, remember to calculate your expected capital gains tax. Many countries charge taxes on profits from crypto sales, and there are differences in how much you’ll pay depending on how long you held the cryptocurrency and your income. Tools like CoinTracker simplify tracking trading activity and generating compliant tax forms for authorities like the IRS.

Make the most of every bull run with CoinTracker

The parabolic pops of a bull run don’t last forever. Before a bull market appears, review your financial goals and risk preferences to take advantage of these opportunities and avoid feeling crushed should the crypto market plummet. Having a game plan early on and watching out for warning signals can help you adjust during a crypto bull market and avoid getting burned. With CoinTracker, you can review your portfolio to see all your assets in real time, so you can decide what moves make the most sense and map out your tax plan for next year in the process.

Ready to take your crypto portfolio to the next level? Start making informed decisions with our expert guides.

Disclaimer: This post is informational only and is not intended as tax advice. For tax advice, please consult a tax professional.