As 2023 came to a close and 2024 began, the crypto market has been showing signs of a resurgence, reminiscent of the bull run in December 2020. This revival has brought with it a sense of optimism and potential, as investors hope for a major improvement.

Since the start of 2023, the market capitalization of the digital asset sector has increased from $831 billion to over $1.8 trillion, demonstrating an impressive growth of nearly 100%.

This has led many to compare the current market to the holiday price action of the last bull run. Antoni Trenchev, co-founder and managing partner at cryptocurrency lending company Nexo, believes that the current price action reflects the 2020–2021 holiday period, which he noted as a prescient moment, preceding the last major bull run before cryptocurrency entered the mainstream. He added:

Now, at the tail end of the 2023–2024 festive season, Trenchev believes that we are on the brink of another exciting chapter. “With an early ‘Santa Rally’ already visible on the charts and the Bitcoin halving scheduled for April 2024, we are optimistically poised for what could be another surge, and the bulls are only just warming up,” he said.

Difference between Web 1.0, 2.0, 3.0 and 4.0

The difference between Web 1.0, 2.0, 3.0 and 4.0 is largely based on the user experience. Web 1.0 was focused on static content, with limited user interaction. Web 2.0 saw a shift towards dynamic content and user-generated content, as well as an emphasis on user experience. Web 3.0 is focused on the semantic web, which allows for the integration of data from multiple sources and the development of more intelligent applications. Web 4.0 is expected to be a more distributed web, with a focus on decentralization, privacy, and security.

Circumstances around crypto bull runs

Jupiter Zheng, partner at institutional asset manager HashKey Capital, told Cointelegraph that, while there are undoubtedly several holiday factors influencing the ongoing market growth — akin to what was witnessed a couple of years ago — there are other peripheral drivers to consider this time around, adding:

Expanding on Zheng’s narrative, Ryan Lee, chief analyst at Bitget Research, believes that, while drawing parallels between the 2020–2021 bull run and the current crypto market scenario is certainly helpful, this time around, the market is being heavily influenced by different macro conditions, including regulatory updates, technological advancements and shifting investor sentiment.

He noted that, while the last bull run was shaped by specific circumstances, like the COVID-19 pandemic, which spurred quantitative easing and institutional investments, this run is being driven by fluctuating inflation rates, interest rate changes and geopolitical tensions.

Additionally, financial indicators like the drop in the U.S. 10-year Treasury yield and a decrease in the U.S. Dollar Index (a measure of the U.S. dollar’s value relative to the majority of its most significant trading partners) have created a favorable environment for Bitcoin (BTC).

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Further bolstering this trend is some optimistic economic data that has emerged, with Lee noting that the U.S. gross domestic product has outperformed expectations, while the Personal Consumption Expenditures (PCE) price index (a measure of consumer spending on goods and services among households in the U.S.) has also shown moderation, staying relatively stable all through 2023. He further added:

The differences between Web 1.0, 2.0, and 3.0 are vast, with Web 3.0 being defined by the advent of decentralized technologies, such as blockchain, that provide the ability for users to interact directly with one another and create value. While Web 3.0 has yet to fully emerge, the current crypto market is providing a glimpse of what it could look like.

Could we witness a crypto rally in the coming weeks?

The market has yet to break past the $1.7-trillion mark, but the ongoing price action is certainly encouraging. Zak Taher, CEO of MultiBank.io, told Cointelegraph that he and his team don’t expect the prices to skyrocket anytime soon, but they do believe that a major rally may be in the offing given the current market conditions.

Institutional interest and adoption are likely to play a key role in the next run, particularly across Europe and the Middle East, according to Taher. Similarly, Denis Petrovcic, co-founder and CEO of Blocksquare, said that while Bitcoin’s recent surge past the $44,000 mark and the increasing interest in Bitcoin ETFs could be more than just a seasonal rally, the market’s optimism may be challenged by the changing global economic landscape.

Tim Berners Lee, the inventor of the World Wide Web, has been talking about Web 3.0 for some time, and there are differences between Web 1.0, 2.0 and 3.0. Lee remains optimistic about the industry’s near-term future, noting that policy shifts, inflation rate adjustments and geopolitical events could all have a positive impact on Bitcoin’s price.

Factors that will potentially drive the next bull market

Between Jan. 5 and Jan. 10, 2024, the crypto market is expecting a decision on the approval of a U.S. spot BTC ETF. If approved, there could be a notable influx of funds into the crypto market similar to what was seen after the approval of the first gold ETFs in 2004. Additionally, the increasing likelihood of a Federal Reserve rate cut in 2024 is another important factor to consider, as it could have significant implications for the market.

With the next Bitcoin halving scheduled for May 9, 2024, it is worth noting that the digital asset’s price has shown a pattern of peaking between 368 and 550 days after the event and then bottoming out between 779 and 914 days later. This cyclical behavior is an essential trend to monitor since it stands to play a major role in driving investor sentiment.

Furthermore, China’s initiative to internationalize the renminbi represents a major shift in global financial dynamics, potentially affecting both traditional and digital currencies. At the same time, the cryptocurrency market is showcasing its diversity, as seen from altcoins like Ether (ETH) and Solana’s SOL (SOL) reaching 19-month highs, even as Bitcoin’s rally shows signs of slowing down.

Lastly, in a broader context, Brazil’s growing consideration of digital currencies for financial transactions within the G20 reflects an increasing global interest in the potential of web 3.0 and the opportunities and challenges it presents in 2024.

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