Bitcoin rose 600% last time, will history repeat itself?

Dennis PorterCEO of SatoshiActFund, observes that bitcoin’s volatility is currently at an all-time low. Publishing a chart, he noted that the last time bitcoin volatility fell this low, “it soared by 600 percent“.

Last time #Bitcoin volatility was this low it went on a 600% rip. pic.twitter.com/BKzCGsZb0k

– Dennis Porter (@Dennis_Porter_) December 27, 2022

On-chain data reveals bitcoin’s volatility is at an all-time high, the lowest of all time. In the chart Porter posted, he shows a similar decline in volatility at the end of 2020.

Bitcoin’s volatility is at an all-time low pic.twitter.com/sGOIC7cM6e

– Will Clemente (@WClementeIII) December 25, 2022

It is worth remembering that bitcoin emerged from the consolidation phase in October 2020. At that time, its price was just under $10,000. A year later, bitcoin reached an all-time high of $69,000 in November 2021, an increase of nearly 600%.

According to crypto analysts who track historical levels of BTC volatility, another time when volatility fell to near current levels was in late 2018. It was a bear market identical to the current situation, with crypto prices falling throughout the year.

Will history repeat itself?

At the time of writing, bitcoin was down slightly over the past 24 hours at $16,833. Bitcoin has been stuck in a narrow range between $16,570 and $16,911 since December 21.

#Bitcoin sits between two significant supply walls. One at $16,600 where 1.46 million addresses hold 915K #BTC and the other one at $17,000 where 1.27 million addresses hold 730K $BTC.

A sustained move outside of this area will likely determine the direction of the trend. pic.twitter.com/oGNdbcPV0k

– Ali (@ali_charts) December 26, 2022

As bitcoin consolidates, a crypto-currency analyst Ali Martinez believes that a sustained move out of the $16,000 and $17,000 could determine the direction of the trend.

Referring to IntoTheBlock’s on-chain data, bitcoin is between two significant supply walls: one at $16,600, where 1.46 million addresses hold 915,000 BTC, and another at $17,000, where 1.27 million addresses hold 730,000 BTC.

However, sustained movement outside of this range could determine the direction of the trend. As we approach 2023, investors should keep in mind that the current macro environment, lack of regulation, confidence in crypto, and lack of regulatory clarity could continue to put pressure on crypto.