Crypto Bulls vs. Crypto Bears

It was the best of times, it was the worst of times.

While some smaller cryptos are firing on all cylinders (especially the Fantom ecosystem, Crypto Pragmatist Pro subscribers caught it first), we have to continue to think about where we sit on a larger time frame. The following chart displays the state of the market pretty well:

This is the first time in recent memory where altcoins have outperformed Bitcoin and Ethereum in a downtrend. This graph begins on October 13th, but the rankings also hold true from Bitcoin’s all time high on November 8th.

The crypto world lends itself to thought bubbles and feedback loops. It’s a healthy exercise to consider how others in the space might be viewing their own portfolios and assets. I think Bitcoiners are concerned, with Ethereum holders perhaps slightly less stressed.

But altcoins seem to be separating from the pack over the last week, with almost half of the top 100 largest cryptos beating out Bitcoin, and nearly 75% of them outperforming Ethereum. Perhaps the market is finally discovering the fundamental value of these assets in a meaningful way.

Bulls vs. Bears

Given the local lows for Bitcoin at $40k and Ethereum at $3k, a good chunk of crypto investors are bearish. But a strong bounce at these levels and a hot altcoin market might signal a reason for continued bullishness. So perhaps the best approach is to take an evidence, data-backed survey of the market to review our options.

Are we in a bear market? It’s impossible (and subjective) to find a definitive answer. And on top of that, the information of being in a bear or bull market is often entirely useless. Labeling the type of market conditions can often be unconstructive:

  • It’s a bear market, but the damage has already been done
  • It’s a bear market, but we’re now in a long-term sideways period
  • It’s a bear market, but we’ve already hit the bottom

This can come into play when we’re in a bull market as well:

  • It’s a bull market, but assets are already overvalued/overextended
  • It’s a bull market, but we’re on the other side of the peak
  • It’s the end of a brief bull market

In many ways, labeling a market is a lagging indicator, making it minimally useful. Total crypto market cap today is about 30% off of previous highs. It’s a lot more useful to know about a bear market before it happens.

But let’s face it: while we can identify relatively undervalued assets, while we can identify market irrationality, and while some people will profess to know exactly where the market is going, we all have one thing in common: we check our portfolios in the morning.

Which means, at the end of the day, none of us really knows what the market will do in the short term. But we can still have fun speculating:

The Case for the Bear Market

First of all, no matter what the market conditions are, it’s impossible to buy the top at this point. If your favorite crypto asset goes down, you’re still better off buying here than three months ago. So on some level, major bearishness is actually a reason to be bullish.

Nonetheless, we could be heading further down or sideways for a while now, and minimizing losses wouldn’t be the worst thing. Let’s take a look at the bear case.

The Technical Analysis Picture

The most compelling evidence for a bear market? A break of the Bull Market Support Band. Crypto technical analysts use this indicator, a combination of two moving averages, as a way to definitively know what type of market we’re in. And the bad news is that we’ve broken it. We are well below the Bull Market Support Band and thus, by default, in a bear market:

Thankfully, a break of the bull support band doesn’t necessarily mean we’re headed directly for a crypto winter. It means we’re in bearish circumstances, sure, but this summer (mid-May to mid-July) we had another ‘mini-bear’ market. So a bear market is not necessarily disastrous, and can just represent an accumulation phase before another leg up.

Anyone who uses this indicator would probably say we’re definitively in a bear market, but that a bear market doesn’t have to be long-term

An Approaching Death Cross

The Death Cross and Golden Cross are mirror images, two technical moving averages that fluctuate against each other. A crossing of them either signals a bullish breakout or a bearish one, and it looks like we’re approaching a Death Cross. That’s the not-bullish one. The following chart looks at the pending death cross for the total crypto market cap, and a death cross for Bitcoin is even more imminent.

Death crosses typically represent another leg down for price, sometimes for the long term, and another cross is all but certain. Thankfully, these crosses are lagging indicators and have often signified the last dip down before a move up.

The Failure of Stock-to-Flow

The stock-to-flow model has been one of the most popular and widely-followed models in crypto in recent years, tracking Bitcoin with astonishing accuracy. But in the last few months, the model has been invalidated, leading to disappointment after predicting a $100k Bitcoin by 2022. Here’s how the stock-to-flow model looks today, with the rainbow line being the real data and the blue line being the model:

So Bitcoin, at least, has gravely dropped off of the trend line this often-cited, often-accurate model. I suppose there are some that might take the optimistic point of view (we’ve got a lot of catching up to do), but a more pragmatic thought process says: “we’ve fallen off the map.”

Even the main advocate for stock-to-flow, Twitter user @100trillionUSD, admits that the model has been refuted.:

The Case for the Bull Market

With bears out in abundance for the last few months, a bounce off of $40k for Bitcoin turned a lot of investors bullish. Perhaps that’s the biggest reason for a sentiment turnaround, but are many other compelling cases for a continued cycle:

Extending Cycles

Crypto Youtuber Benjamin Cowen is the biggest advocate for an extending cycle theory, stating that, by trough to peak, each cryptocurrency boom-bust cycle has lengthened. This continues to be the case, but by the data, as of today the most recent cycle hasn’t meaningfully extended past the previous one. By this logic, we should see a continued cycle and continued growth, with plenty of space for both Bitcoin and total crypto market cap to continuously rise in price.

Purple: current cycle

On-Chain Analysis

On-chain data seems to be perpetually bullish, and it continues to look as such. Wallets continue to go up, and whales are still accumulating. Bitcoin is being steadily withdrawn off exchanges, often seen as a bullish indicator.

Below is a more complex metric called Entity-Adjusted Dormancy Flow, which, to simplify, basically refers to how much a coin is moving around. All time lows have typically triggered price run ups, and this indicator currently sits at just one of six all-time-low levels.


In reflexive and mimetic markets such as crypto, denying the market sentiment is a huge mistake, which, considering the circumstances, actually feels quite positive at the moment.

Some of the biggest names in the space are very notably bullish, especially on Bitcoin, which tends to lead markets. Below, we’ve taken a look at four major crypto twitter personalities, all bullish:

The Case for the Supercycle

Several big names in the crypto space have been claiming that we’re headed straight for a supercycle: a crypto market where there’s no long-term downturn in sight, with mild and occasional pullbacks the worst case scenario.

The hypothesis for a super cycle is the following: crypto has become big and important enough where it is simply impossible to ignore. Nation-states are adopting Bitcoin and crypto rails, central banks are creating centralized digital stablecoin competitors, and the mainstream is being onboarded to ideas like Bitcoin and Ethereum. That real value and major adoption will create an extended period of pure upward market movement, with crypto becoming an asset class worth many trillions of dollars.

Think about it, anyone who owns an S&P 500 index fund owns a small amount of Bitcoin via Tesla. So could we be in the early stages of a supercycle? Possibly, and big names like Su Zhu of Three Arrows Capital are doing their best to will it into existence. With two dog coins in the top 15 cryptos, it’s a bit tricky to imagine, but hey, anything can happen.


The current period of the market could definitely be called a bear market, but it doesn’t mean everyone is doomed to perpetual poverty. Perhaps we’ve just begun a turnaround, with a bullish kick-up just around the corner. No matter what, it’s a better time to buy than the top.

Good luck out there.