What is a Bull Market?

A bull market is a sustained period where asset prices rise continuously, driven by optimism, FOMO, and waves of capital flooding into the market. In crypto, a bull market typically means Bitcoin is making new all-time highs, Ethereum is pumping, and altcoins are going parabolic with 10x-100x gains.

It's the period when your uncle who's never invested in anything suddenly asks you about Dogecoin. When crypto Twitter is euphoric. When "this time is different" becomes the rallying cry. When influencers with zero financial credentials are shilling 100x moonshots to millions of followers.

Bull markets create generational wealth—and also generational losses for those who don't understand the cycle.

Here's the uncomfortable truth: bull markets don't last forever, they always end in spectacular fashion, and most people who get rich on paper during a bull run give it all back because they don't sell. Understanding the phases, psychology, and warning signs is the difference between retiring early and becoming a cautionary tale on Crypto Twitter.

The Four Phases of a Crypto Bull Market

Every crypto bull market follows a predictable psychological arc. If you can identify which phase you're in, you can position yourself to profit instead of becoming exit liquidity.

Phase 1: Stealth (Smart Money Accumulation)

This is when the bottom is in, but nobody believes it yet. Prices have been bleeding for months or years. Smart money—VCs, whales, early adopters—is quietly accumulating while retail investors capitulate.

Bitcoin bottomed around $3,200 in December 2018. Those who bought during this phase made 20x+ by 2021. This is psychologically the hardest to buy but offers the best risk/reward.

Phase 2: Awareness (Institutional Arrival)

Prices start climbing steadily. Bitcoin breaks through key resistance levels. The media begins covering crypto positively again. Institutional players make public moves—MicroStrategy, Tesla, Grayscale.

In 2020, Bitcoin climbed from $8,000 to $20,000 as companies added BTC to their balance sheets. DeFi Summer saw Total Value Locked explode from $600 million to $10 billion. Gains during this phase are steady and substantial (2x-5x), with relatively lower risk.

Phase 3: Mania (Retail FOMO)

This is where things get wild. Bitcoin and Ethereum make headlines every day. Your barber gives you crypto tips. Parabolic price increases of 20-50% per week are common. Logic disappears—fundamentals don't matter.

December 2017: Bitcoin hit $20,000. Coins with no product raised $100 million in ICOs. Late 2021: Bitcoin hit $69,000. Dog coins like SHIB pumped 1000x+. Market cap exceeded $3 trillion.

This is where most people think they're making life-changing money. In reality, they're holding bags that will drop 95%+ when the music stops.

Phase 4: Blow-off Top (The End)

The final surge before the crash. Prices go vertical. Everyone thinks it'll never end. Rational voices warning of a top are mocked and ignored.

Warning signs: celebrities endorsing altcoins, taxi drivers asking about crypto, new projects pumping 100x on launch day with no product, extreme greed on the Fear & Greed Index (90-95+), and funding rates on perpetuals at 0.1%+ daily.

Bitcoin peaked at $69,000 on November 10, 2021. Within two months, it had dropped to $35,000. By November 2022, it was at $15,000—a 78% decline. Altcoins fared even worse, with most dropping 90-99%.

The Capital Rotation Pattern

Understanding where capital flows during a bull market is critical:

Bitcoin Leads: Bitcoin pumps first, breaking out from consolidation. BTC dominance increases. This is the safest phase.

Ethereum and Large-Caps Outperform: Once Bitcoin stabilizes, capital rotates into Ethereum and top 10-20 projects. ETH/BTC ratio climbs.

Altseason Mania: The final phase. Capital floods into mid-cap and low-cap altcoins. Parabolic gains on obscure tokens. This is where retail makes and loses the most money.

In 2017, Bitcoin's dominance dropped from 87% to 32% as capital rotated into ICOs. In 2021, it fell from 70% to 40%. When Bitcoin dominance is falling and altcoins are pumping 20-100x, you're in the late stages. That's your signal to start taking profits, not buying more.

Why Most People Lose Money in Bull Markets

It seems paradoxical: how do people lose money when everything is going up?

Greed and overconfidence. After seeing your portfolio 5x in six months, you start believing you're a genius. You take bigger risks, use leverage, chase lower-quality projects.

FOMO into garbage. You see some shitcoin pump 50x and rotate your Bitcoin and ETH gains into speculative garbage at the top. Within weeks, those projects are down 80%.

Refusing to take profits. The classic mistake. You're up 10x on paper but convinced it'll go to 100x. Bitcoin never hits your target that cycle. It crashes. Your 10x unrealized gain becomes a 60% loss.

Holding through the crash. You're in denial. "It's just a correction." You hold through a 50% drop, then 70%, then 90%. You're now down overall and psychologically destroyed.

The solution? Have a plan before the bull market. Set profit targets. Sell incrementally into strength. Don't marry your bags.

Historical Bull Markets: What Actually Happened

The 2017 ICO Mania:

• Bitcoin: $1,000 → $20,000 (20x in 12 months)
• Ethereum: $10 → $1,400 (140x in 12 months)
• Total market cap: $800 billion at peak

The crash: Bitcoin dropped 83% to $3,200 by December 2018. Most ICOs went to zero.

The 2020-2021 DeFi/NFT Boom:

• Bitcoin: $8,000 → $69,000 (8.6x in 21 months)
• Ethereum: $150 → $4,379 (29x in 21 months)
• Total market cap: $3 trillion at peak

The crash: Bitcoin dropped 78% to $15,500 by November 2022. Ethereum dropped 82%. NFTs dropped 90-99% in floor prices. Luna collapsed, FTX collapsed, contagion destroyed the market.

Every bull market feels unique and "different this time." Every bull market ends the same way: with a brutal bear market that wipes out 70-90% of the gains.

How to Actually Profit From a Bull Market

Enter during the stealth or awareness phase. The best risk/reward is when everyone thinks crypto is dead. If you're buying during mania, you're probably late.

Have a profit-taking plan. Decide in advance: "I'll sell 25% at 3x, 25% at 5x, 25% at 8x, and hold 25% for the moonshot." Stick to it.

Rotate down the risk curve carefully. Start with Bitcoin and Ethereum. Only rotate into altcoins when your core positions are in profit. Never go all-in on shitcoins.

Avoid leverage. Leverage is how you blow up in crypto. A 20% pullback with 5x leverage wipes you out completely. Spot holdings only.

Watch the warning signs. When your non-crypto friends are shilling you coins, when funding rates are at all-time highs, when new projects are pumping 100x with no product—start taking profits aggressively.

Cash out to stablecoins or fiat. Rotating from one shitcoin to another isn't "taking profits." Converting to USDC or USD is.

Prepare for the bear market. Bull markets end. Always. If you make life-changing money, secure it. Pay off debt, buy assets, diversify. Don't give it all back.

Conclusion: Bull Markets Are a Gift—Don't Waste Them

Crypto bull markets are one of the fastest wealth-creation opportunities in history. It's possible to turn $10,000 into $100,000 or more in 12-24 months if you position correctly.

But they're also wealth-destruction machines for those who don't respect the cycle.

The winners:

• Buy during fear (stealth/awareness phase)
• Sell into euphoria (mania/blow-off phase)
• Have a plan and stick to it
• Take profits incrementally
• Avoid leverage and shitcoins

The losers:

• Buy during euphoria
• Refuse to sell because "it's going higher"
• Hold garbage altcoins through the crash
• Use leverage and get liquidated
• Have no plan and trade emotionally

Bull markets feel like they'll last forever. They never do. If you're reading this during a bull market, set your profit targets now. If you're reading this during a bear market, start accumulating quality projects and be patient.

The next bull market is coming. The question is: will you be ready?

References

1. Phemex Academy - 6 Crypto Bull Market Peak Indicators for 2025: https://phemex.com/academy/bull-market-peak-indicators
2. Mind Math Money - Market Cycles Explained: 14 Phases Every Trader Must Know: https://www.mindmathmoney.com/articles/master-market-cycles-the-psychology-behind-every-rally-and-crash
3. Brave New Coin - The Bitcoin Bubble: Four Phases Analysis: https://bravenewcoin.com/insights/the-bitcoin-bubble-pinpointing-where-bitcoin-is-among-the-four-phases
4. CryptoHopper - Crypto Bull Run History: Key Factors That Drove Past Rallies: https://www.cryptohopper.com/blog/crypto-bull-run-history-key-factors-that-drove-past-rallies-12260
5. Wayex - A Historical Recap of Past Crypto Bull and Bear Markets: https://www.wayex.com/blog/a-historical-recap-of-past-crypto-bull-and-bear-markets
6. Guarda Academy - Crypto Market Cycles & Bitcoin Bull Runs: https://guarda.com/academy/crypto/crypto-market-cycles/
7. CoinTracker - What is a Crypto Bull Run? Key Signs, History and What to Expect: https://www.cointracker.io/blog/crypto-bull-runs
8. Wundertrading - Crypto 2025 Outlook: Trends, Forecasts, and Market Insights: https://wundertrading.com/journal/en/learn/article/crypto-2025-forecast