History of the Bitcoin Bull Run: The origins and triggers

Since its creation in 2009 by a pseudonym known as Satoshi Nakamoto, Bitcoin has experienced periods of volatility and exponential growth.

Among the most emblematic moments of its evolution are the "Bull Runs" (periods of strong growth) which have captivated the attention of investors and the general public.

In this article, we will explore in detail the major Bitcoin “bull runs” since its birth, explaining the factors that contributed to these spectacular increases as well as the end of the cycle that follows them.

1/ The First Bull Run of 2011: Bitcoin as a means of payment

Bitcoin's very first "bull run" occurred roughly two years after its creation in 2009. While it might be an exaggeration to call it a bull run at that time, it was nonetheless a period of undeniable price increases for Bitcoin. Back then, Bitcoin had a relatively small user base , primarily composed of information professionals, developers, and crypto enthusiasts. The price surge was mainly attributed to curiosity and word-of-mouth within tech circles. On May 22, 2010, engineer Laslzo posted an ad offering to pay for two pizzas with 10,000 bitcoins . The idea of ​​using Bitcoin as a means of payment had just been born.

However, the first real surge in Bitcoin's price occurred in 2011 when mainstream media began reporting on it. This reached a wider audience, primarily due to coverage of events related to the "Silk Road" website, launched by Ross Ulbricht . This was a dark web platform for selling illicit goods that accepted Bitcoin as payment. This significantly contributed to increased (albeit controversial) publicity surrounding Bitcoin. The price then rose considerably, reaching parity with the US dollar for the first time.

Read the article: The incredible story of Ross Ulbricht, Silk Road and the rise of Bitcoin

2/ The Bull Run of 2013: The leverage of trading platforms

The 2013 "Bull Run" is often considered Bitcoin's first true rally, fueled by a combination of factors. First, the increasing adoption of Bitcoin by businesses and merchants boosted confidence in its value. Second, social media, particularly Reddit and Twitter, played a crucial role in creating a massive Bitcoin craze, fueling FOMO (Fear of Missing Out) among many enthusiasts. Early Bitcoin popularizers and evangelists like Bitcoin Jesus and Andrea Antonopolous gave talks on Bitcoin.

Furthermore, the emergence of the first Bitcoin exchanges in 2011 facilitated easier access for investors worldwide who wanted to buy Bitcoin. At that time, the Mt. Gox exchange platform was the undisputed leader, accounting for a significant portion of trading volume. From August to December 2013, Bitcoin rose from $120 to its all-time high, surpassing $950.

However, this period was also marked by concerns over the security of trading, and the sudden closure of Mt. Gox in 2014 led to a crisis of confidence in the market, which ended this initial bull run.

Read the article: The terrible fall of Mt Gox and Mark Karpelès

3/ The explosion of 2017: The attraction of the general public

The 2017 Bull Run was the most spectacular yet, propelling the price of Bitcoin to unprecedented highs. This period was marked by the entry of traditional financial institutions into the Bitcoin ecosystem. More generally, these were investment funds, investors and entrepreneurs who wanted to take advantage of the financial opportunities offered by this new industry.

The 2017 bull run was the one that attracted the most people who weren't necessarily initially interested in finance or trading. A wider and younger audience has been attracted to cryptocurrencies in general. This frenetic era is in fact marked by the advent of ICOs and the multitude of new cryptocurrencies which were born at this time, in particular, on the Ethereum network.

In 2017, for the first time, on December 17, 2013, bitcoin reached the price of $19. You should know that this price movement – ​​at the end of the year – is a characteristic that we often find in bull runs but also in bearish cycles.

Furthermore, the growing interest of Asian countries, particularly Japan and China, with their mining operations, contributed to the increase in transaction volume. Japan officially recognized Bitcoin as legal tender, further boosting market demand. However, excessive speculation and a lack of regulation in some countries, with bans such as those in Venezuela and Morocco, led to a sharp correction in 2018.

4/ The big splash of 2021: The adoption of Bitcoin and use cases for cryptocurrencies

After the 2017 bull run, the Bitcoin market plunged into a prolonged period of decline, commonly referred to as the crypto winter, where the Bitcoin price fell from $19,500 to $3,600. This phase was characterized by a series of price corrections and consolidations, which was a real test of the cryptocurrency’s resilience.

However, during the COVID-19 pandemic, the craze for cryptocurrencies and NFTs has marked a real frenzy on the part of investors and traders. In April 2021, bitcoin reached its all-time high of $63,300 and $68 in November of the same year. This has been a unique year where bitcoin has reached its two highest highs in the space of a year. Multiple companies have been created with new methods and products linked to cryptocurrencies such as yield farming, play-to-earn games, etc.

However, this euphoric period was abruptly halted by the collapse of the Terra blockchain and its algorithmic stablecoin, UST. The ensuing bear market was resounding, with a significant loss of investor confidence. This was followed by a string of company closures, including the second-largest exchange platform, FTX, founded by Sam Bankman Fried . 2022 was then considered a year of reckoning, during which the numerous crypto criminals operating within the industry were exposed .

Read the article: 2022 was a hellish year, but in the end, it was a good thing.

Future Outlook: Potential Factors for the Next Bull Run

As the Bitcoin market continues to mature, several factors could influence the next bull run. One of the most anticipated narratives is the increased adoption of Bitcoin by financial institutions such as BlackRock, with the introduction of Bitcoin ETFs, among other things. This would strengthen its legitimacy as a store of value and investment asset, further legitimizing Bitcoin in the current financial landscape.

This could potentially be a key element for the next bull run. However, it's also worth noting that we may not see bull runs as exponential as those we've experienced so far. Indeed, the 2022 bear market is somewhat different, longer, and more dramatic than other bear cycles in cryptocurrency history.

You can read this article to learn more about the characteristics of this bear market: Can we know when this hellish bear market will end?

However, bull and bear cycles are part of what constitutes a financial market, and it is easy to estimate that the price of Bitcoin still holds surprises and higher peaks for us… Indeed, during this period, significant developments have taken place in the Bitcoin infrastructure, including improvements to the protocol, improvements in scalability , and progress towards the implementation of Lightning Network technology , enabling faster and less expensive transactions.

This could mark the next bull run and in any case, it is certainly a positive point for ever greater adoption of bitcoin around the world.

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Note: This is not investment advice. Always do your own research.