The Two Faces of Crypto Cycles

In the world of cryptocurrency (and financial markets in general), prices rarely move in a straight line. Instead, they swing between extended periods of enthusiasm and caution. These phases are commonly known as bull runs (or bull markets) and bearish markets (bear markets). Understanding the difference between them is essential for any investor navigating the volatile crypto space.

What is a Bull Run?
A bull run, often called a bull market, is a sustained period where asset prices rise significantly over time. In crypto, this is the exciting phase everyone talks about — think massive gains, new all-time highs, and headlines about "to the moon."
Key characteristics include:
Rising prices — Typically defined by a 20%+ increase from recent lows, with consistent "higher highs."
High optimism — Investor sentiment shifts to greed and confidence. The Fear & Greed Index often hits extreme greed levels.
Increased activity — Trading volumes surge, new users flood in, projects launch rapidly, and FOMO (fear of missing out) drives more buying.
Demand > Supply — More people want to buy than sell, pushing prices upward in a positive feedback loop.
Bull runs in crypto are often tied to events like Bitcoin halvings, institutional adoption (e.g., ETFs), regulatory clarity, or emerging narratives (AI tokens, DeFi, etc.). Historically, these phases can last 12–18 months post-halving and produce explosive returns — but they also tend to end with overvaluation and euphoria.
What is a Bearish Market?
A bearish market, or bear market, is the opposite: a prolonged period of declining prices and waning confidence. This is the painful phase where portfolios shrink, hope fades, and many participants question their decisions.
Key characteristics include:
Falling prices — Usually defined by a 20%+ drop from recent highs, with consistent "lower lows."
Pessimism and fear — Sentiment turns to caution, uncertainty, and capitulation. The Fear & Greed Index often plunges into extreme fear.
Decreased activity — Trading volumes drop, new users disappear, weak projects fail ("crypto winter"), and selling pressure dominates.
Supply > Demand — More people want to sell than buy, often triggered by profit-taking, macro events (recessions, rate hikes), or scandals.
Bear markets can be brutal in crypto, with 70–90% drawdowns not uncommon (e.g., 2018 or 2022 winters). Yet they also clear out speculation, allowing stronger projects to survive and set the stage for the next cycle.
Why Do These Cycles Happen?
Crypto markets are cyclical, often following Bitcoin's roughly four-year halving pattern. Bull runs build on hype and liquidity inflows, while bear markets correct excesses and shake out weak hands. External factors like global economics, regulation, and technological adoption amplify these swings.
As of early 2026, the crypto market shows mixed signals — some analysts see lingering bull momentum from previous years, while others warn of a potential "bear leg" or correction ahead, possibly testing lower levels before the next upswing.
Navigating Both Phases
In a bull run: Focus on risk management — take some profits, diversify, and avoid excessive leverage.
In a bearish market: Accumulate quality assets at discounts, stay patient, and remember that every major crypto bull run was preceded by a deep bear phase.
Bull runs feel euphoric, but bearish periods build resilience. Both are natural parts of the market — surviving one prepares you to thrive in the other. Whether we're heading into more upside or a cooldown in 2026, understanding these dynamics helps turn volatility from a threat into an opportunity.