We see the terms "bear market" and "bull market" being thrown around constantly throughout the crypto world.  Especially with Bitcoin, as Bitcoin dominates the crypto market as a whole and basically determines the health of it.  Bear market is a term used to describe a market that is stagnant and/or underperforming for an extended period of time.  Bull markets are the opposite; the prices are rising or expected to rise in the very near future.

While it's hard to predict the way the market will be moving, these two markets can help you decide if it's going to be the right time to invest for yourself or wait it out.  The crypto market is extremely volatile and should always be navigated with caution.  So... we already know briefly what bull and bear markets are from above.  Let's take a closer look at the characteristics behind each one!

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This is not financial advice.  I am not a financial advisor.
Please do your own research before making any decisions before investing. 
This article is meant for educational purposes only.

A bear market is when the market experiences a prolonged drop in value of an asset.  Usually, this term describes the market when prices fall 20% or more from recent highs.  Not only the price decrease, but you'll tend to see more fear, uncertainty, and denial during this period of time.  A good majority of investors will either hold onto their assets or sell off due to emotional trading.  It's difficult to find a suitable point of entry on an investment during this time, as it's hard to predict the market bottom.

Given that the crypto market is volatile, it's hard to say what exactly causes a bear market.  Generally, a weak or sluggish economy will cause a bear market... but unfortunately nowadays, it seems like a simple tweet will do the trick.  Historically, bear markets have lasted from a few weeks to several months with previous drops in overall market value.  They should not be confused with market corrections, which is a short-term trend that has a duration of less than 2 months.

Bull markets are characterized by investor optimism, confidence, and expectation that strong results are soon ahead and should continue for an extended period of time.  These generally take place when the market is strengthening or is already strong and increasing in value.  There's no specific or universal metric used to identify a bull market at the time of writing this article, but it's commonly defined as when the market value rises by 20% after a drop of 20%.  During this time, investors will most likely put on their day-trading cap and get to work to maximize their profits.

With the rising, positive demand for crypto, we have seen a lot of bull markets between now and 2009, when Bitcoin was first launched.  We've also seen a lot of bear markets thrown in the mix as well.  A fun fact - the terminology is coined from how the two different animals engage in combat.  Bulls thrust their horns up into the air and bears swipe down at their opponents.  Regardless, the crypto market is continuing to grow daily with new DeFi projects and DApps being added across multiple different platforms.  It's never set-in-stone when it's a good time to invest, so it's always good to invest in projects that are worthwhile and valuable with their purpose!

Do you think we are currently experiencing a correction or a bear market?
Let us know in the comments down below!

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