We are in the midst of a raging bull market and some investors are worried that it is becoming overheated. After a 48% return in January (more info below), the market already gained over 70% in the first half of February.

For a perspective: the crypto market average monthly return in 2017 was 43% (Bitcoin’s was 24%). Yes, the growth in 2021 is explosive, but we have seen a similar dynamic in play during the previous bull run. Check the chart below to see the monthly returns for Bitcoin and the broader market (click on an image below for a larger image):

2017 monthly returns

Also worth noting is that in 2017 market participants were mainly individual investors. In this bull run, we also have large institutional investors, corporate investors, and many other entities not present in 2017. Yes, we will see shorter and longer pullbacks, but this bull run still has a lot of room to grow.

Market overview

The crypto market continues with its bullish momentum in 2021, marking its fourth consecutive month of positive returns in January. During the first ten days, the crypto market steadily appreciated, gaining 46.3% in the process. This was followed by a swift one-day correction of -21.7%, which resulted in a loss of the majority of profits gained during the first ten days. Nevertheless, the crypto market quickly rebounded and managed to end the month with a positive monthly performance of 48.21%.

Chart 1 - Crypto market performance (2021-01)

24 of the top 25 assets posted gains in January. The top three performers were Dogecoin (+695%), AAVE (+243%), and Uniswap (+242%), and the only asset that ended the month with a negative monthly performance was Monero (-12%). On 3 January, Bitcoin’s dominance marked its highest level of this latest crypto bull run at 72.7%. After that, Bitcoin’s dominance has gradually declined and ended the month at 62.2%.

Chart 2 - Top 25 assets by market cap performance (2021-01)

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DISCLAIMER: This article is for informational and discussion purposes only and does not constitute a marketing message, an investment survey, an investment recommendation, or investment advice. The article was prepared exclusively for a better understanding of market dynamics.

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