 The crypto bull market is about to enter its second most explosive phase, according to data from on-chain analysis. So we're at the transition point into the euphoria phase. Price will rise until supply comes back on the market to satisfy it. What can blockchain data tell us about Bitcoin's next movement? What should we expect for the second and final phase of the bull market? And how can we recognize its peak? We asked James Czech, the lead on-chain analyst at Glassnode, to answer these and more questions. Everybody is wondering where is the market going next? Are we going to see a further consolidation? Or we're going to see a resuming of this impressive bull market towards new all-time highs. So is there anything that on-chain analysis can tell us about this? It's only been about a 15-16% correction. And if you can believe it, we've only had a 20% correction since the FTX loads in November 2022. So in all that time, we've only pulled back by 20%. Now, if you compare that to previous bull market uptrends, if you look at 2016 or 2017, we had very regular 25-30% correction. So all the order of double where we are at the moment. If you go back and look at 2019, it was a bit of a funny cycle back then. But 2019, we got 50-60% plus corrections. So really, really deep pullbacks. So thus far, it's actually been remarkably resilient. The market just seems to find support very quickly. And this is obviously a good sign. There's a lot of components here. We've got the ETS, which personally, for me, they're probably about 10 times bigger than I had anticipated. We're talking about $100 million days relative to tens of millions. Now, that said, these things, I mean markets and ETF flows and all this stuff, nothing happens in a straight line. So naturally, we were going to always hit a point where that we're going to slow down a little bit, whether temporarily or for whatever reason. So what we saw last week in particular was a series of outflow days, where GBTC came into some very, very large sell-side pressure. A lot of bankrupts of states are trying to still liquidate all of their holdings. And we had a bit of a slowdown on the inflow from the other ones. Now, that's not the only component. If we look at it from the on-chain world, as we break through all-time highs, it's a very, very classic signal. I mean, what we see in every single previous cycle is as you get to new all-time highs, what we call the long-term holders. People have held their coins for a long time. They really start to ramp up their spending. And we've seen this. It's exactly the same as every previous cycle. Remarkably, it feels like it should break these models, but they just seem to keep ticking along. So not only have we seen GBTC, we've also seen existing holders get into a very, very significant amount of profit. And as a result, they've started taking some chips off the table. So in many ways, it looks the same as every previous all-time high break. Remarkably so, to that point. The more time we spend up here chopping wood and actually just trading sideways, what happens is the market and investors get used to this new altitude. And it kind of gets, you know, it helps people become used to 73,000, to become used to 60,000. And the longer that we spend up here, the deeper the correction. Generally speaking, the more that allows that process to happen. And pullbacks are a part of a healthy uptrend. And if you actually don't have a pullback, let's imagine that tomorrow we wake up, we're at 100 grand. The probability that we're going to have a much deeper and much angrier, much longer correction actually goes up. Because the market hadn't really found equilibrium. So pullbacks and corrections are very, very good. They help market trends. So you do need this kind of counter-trading both directions. You said that this is the most solid and resilient bull market that we have ever seen in Bitcoin history, correct? Yeah. And that's just simply looking at it from a drawdown perspective, right? I mean, there was really been two phases, two and a half maybe, phases since the FTX lows. The recovery phase was most of 2023, up until about October. And the way I would describe that, it was only the hodlers. There was no new money coming in. It was only bear market survivors, people who really believe in Bitcoin. They were the primary actors. And they accumulated a huge amount of supply back down there, below 30K kind of levels. Then we had the next phase, which is between about 30K and the all-time high. And I call this the enthusiastic bull. People now believe the bull market is in place. The excitement about the ETFs coming started to pick up. They obviously then went live. And then we very, very quickly went from 42K all the way up to 70. Now we're kind of at the phase of transitioning between the enthusiastic bull and what I call the euphoric bull. And the euphoric bull is much like 2021. As you break the previous all-time high, a lot of mechanics change. Long-term holders have been dormant for a long time start to spend. People get more and more excited. The market moves much more violently. You've got a lot more volatility starts to creep in. So these are all the things that we can probably expect moving forward. More long-term holders spending, more people talking about it on the news, which is demand that comes in. And these two forces are always trying to balance each other. And price will rise until supply comes back on the market to satisfy it. So we're at the transition point into the euphoria phase. And that euphoria phase can nearly go for several months, at least in previous instances. Sometimes it goes for over a year. Most of the 2017 year was a euphoric phase bull. So we can see this go for a long period of time. But yeah, it really comes down to when that saturation of supply and demand gets hit. How is the on-chain analysis different from technical analysis, for example, as a tool to understand the Bitcoin markets? Great question. So technical analysis at the end of the day, what you're looking at in technical analysis, it's usually price and some various indicators. Price volume and various indicators. Now, why do we have, let's say for example, ascending or descending triangles or head and shoulder patterns? Why do these patterns tend to have a statistical lean that the market wants to move in a particular direction? And a second question to that is why do those patterns work now when you can go back and look at assets trading in the 1920s or the 1950s? And those patterns still seem to work back then as well. Why is this? And the reason why is it human beings, right? We are generally speaking not equipped to trade markets because our brain hardware, the way, you know, our ape brain from, you know, a thousand-year-old hardware is designed to avoid risk as like a self-preservation mechanism. Now, markets, because we expose ourselves to risk, you buy something and it can go up and go down, it can be exciting, you experience fear and greed. These are all very visceral human emotions. So the human brain responds to markets and paints these patterns. When you add risk and you add capital and all these things, this is why technical analysis works. Yes, there's certain frameworks, and this pattern means this, and this pattern means this, but at the end of the day, you're measuring what human beings are doing in aggregate. On-chain analysis is more or less taking all those same concepts but looking at it in the transaction volumes, looking at it in terms of coins moving in profit and loss, looking at are they whales? Are they shrimps? Are they long-term? Are they short-term holders? So rather than painting that picture in price and volume, what we're looking at is, well, who is spending? Who is selling? Who is buying? Who is coming in? Who's holding? Who's not? They're all the same psychological components are baked into. Are they in profit? Are they losing money? All of these things help us really digest what's going on in the market. Do you have any price range in mind when it comes to predicting the price of Bitcoin at the top of this bull cycle? I have absolutely no idea. And I think anybody who says that they know is wrong because no one knows. I'm very much in the camp where I don't give price predictions. I don't try and philosophize on when things happen because the way I like to approach markets and data about the markets is it will happen when it happens. So I know what kind of behaviors and patterns I'm looking for. I want to see long-term holders having really flushed out a lot of their coins. I want to see supply saturating demand. I want to see profits that are just unbelievably high and lots of my statistical levels getting blowed out. When I've got all of those in play, whatever the price is at, that will be what I would start saying. It's starting to look like a top. All right, cool. Thanks a lot, James. It's always a pleasure to have you on our show. Sounds great, mate. Thanks for having me on. It was a pleasure.