What is Bull Run in Crypto?

Home / Blog / Glossary / What is Bull Run in Crypto?

TL;DR: A bull run is a time in the crypto market when the prices of specific assets are going up.

To get a clearer idea of what a ‘bull run’ means in crypto, first, we should talk about ‘bull’ and ‘bear’ markets.

Think of them as the investor’s weather report, giving you a heads-up on the financial landscape’s highs and lows. We’ll unpack these terms and see how they shape the crypto market.

Table of Contents

What is a bull market?

A bull market, also known as a ‘bull run,’ is when most investors are buying, demand is high, confidence is strong, and prices are going up. If you notice prices shooting up in a market, it might mean investors are feeling optimistic or “bullish” about prices going even higher, signaling the start of a bull market.

Investors who think prices will keep going up are called “bulls.” As confidence grows, more investment follows, pushing prices even higher in a positive cycle.

Since a cryptocurrency’s price is heavily tied to public confidence, some investors gauge this optimism (called “market sentiment”) to make decisions.

How do you know when a bull market is over?

Well, even in a bull market, you’ll see ups and downs. Sometimes, those downs might look like the end of the good times, but it’s important not to jump to conclusions too quickly. Take a step back and look at the bigger picture over longer periods rather than just reacting to short-term drops. Some folks with a shorter focus call this “buying the dip.”

History teaches us that bull markets can’t last forever. Eventually, something might shake investor confidence, like bad news or unexpected events such as the COVID-19 pandemic. When confidence starts to drop sharply and more people believe prices will keep falling, that’s when a bear market can begin. It’s like a downward spiral as folks sell off to avoid bigger losses.

What is a bear market?

Bear markets happen when there’s more supply than demand, confidence drops, and prices fall. Those who expect prices to keep dropping are called “bears.” Bear markets can be tricky, especially for new traders.

Predicting when a bear market will end or hit rock bottom is tough. Bouncing back usually takes time and depends on lots of outside factors like the economy, how investors feel, and world events.

But bear markets aren’t all bad. If you’re in for the long haul, buying during a bear market can pay off when things pick up again. Short-term investors can look for quick price jumps or drops. Advanced traders might try short selling, betting on prices falling. Dollar-cost averaging is another tactic, where you invest a fixed amount regularly, smoothing out risks during market ups and downs.

Where do “bull” and “bear” terms even come from?

Well, like many money terms, their roots aren’t crystal clear. There’s plenty of history and discussion on this topic.

One popular theory about the origins of “bull” and “bear” in finance goes back to the 18th century in England. It’s said that these terms were used in the context of the stock market based on the way each animal attacks.

“Bulls” are known for thrusting their horns upward when they attack, symbolizing a market where prices are rising and investors are optimistic, just like a bull charging ahead. On the other hand, “bears” swipe downward with their claws, representing a market where prices are falling, and investors are more cautious or pessimistic, similar to a bear pushing prices down.

This metaphorical usage of “bull” and “bear” to describe market conditions became popular over time and is widely accepted in the financial world today. However, it’s important to note that while this theory is popular, it’s not the only one, and the exact origins of these terms may have multiple influences.

Interested in learning more? For a better understanding of how things work in crypto world, check out our post on crypto exchanges.