Blockchain strategist Jamie Coutts compares the current crypto market with early 20th-century American stock markets, suggesting historical parallels. He scrutinizes Bitcoin’s fundamentals, indicating that the recent price surge was not solely due to speculative positioning before the launch of a spot ETF.
Coutts points out that an index comprising various Bitcoin network adoption metrics is at an all-time high, yet Bitcoin’s price remains 40% below its peak. This discrepancy could signal a potential decline in Bitcoin’s value.
The analyst notes that the network activity index has reached significant new highs supported by new use cases like inscriptions, differing from the last cycle. He claims that Bitcoin’s network fundamentals appear the strongest since the 2016-2017 cycle, drawing a parallel with the US stock market of the early 1900s.
Coutts likens the current state of the crypto ecosystem to the rising US economy of that era, predicting that ETFs could trigger a massive capital inflow into crypto over decades. He compares the pre-1933 US stock market and the post-1934 Securities Act environment to today’s crypto market conditions.
Anticipating a similar emergence of technical analysis and trend strategies in crypto, Coutts foresees a rise in factor-based and market timing strategies in the coming years, considering current market inefficiencies that could persist for several years.