Original insights by Benjamin Cowen, meticulously summarized by the CoinSpeech team. For those intrigued by market valuation dynamics, Benjamin Cowen’s latest video offers a wealth of knowledge. You can find his new video embedded below.
The Current Market Landscape
As of July 1st, 2024, the total cryptocurrency market capitalization is approximately 2.333 trillion dollars. According to Cowen, the fair value logarithmic regression trend line is around 2.735 trillion dollars, indicating “an undervaluation of approximately 14.72%”. This portrays a cyclic pattern of periods of undervaluation and overvaluation in the market.
Historical Trends and Patterns
Cowen elucidates how historic data supports the current trends. He notes the regularity of the market touching the regression trend line, then falling below it, only to rise again. The pattern has been consistent across multiple cycles:
- In 2012, the market crossed and fell below the trend line multiple times.
- This phenomenon repeated in subsequent cycles up to 2020.
“We got above it in 2019 and then fell back and then got above it in 2020 and then fell back,” Cowen elaborates.
Market Behavior Post-Halving Events
The video emphasizes how post-halving years have influenced the market’s overvaluation. Cowen mentions, “durable overvaluation did not occur until really November until Q4 of the having year,” usually marking a significant upward trend. This pattern highlights the delayed yet robust market response post-halving events.
Short-Term Expectations
Current short-term expectations appear grounded. Bitcoin’s value fluctuates, with Cowen recently observing it at 63K. He recommends vigilance, especially around “that bullmarket work band” and other short-term indicators like the 20 and 8-week EMA. He also sets realistic expectations for potentially boring summer periods, noting, “last summer was relatively boring could be the same this summer.”
Future Projections
Looking to the future, Cowen’s target for the entire cryptocurrency market capitalization is ambitious yet tempered: approximately 10 trillion dollars, with a margin of a few trillion. This projection encapsulates his forward-thinking approach while acknowledging the market’s inherent volatility.
Below, you can watch Benjamin Cowen’s new video for a more detailed analysis: