Starkiller Sees End of Crypto Bear Market as Bitcoin and Ethereum Reclaim Key Levels

Quantitative investment firm Starkiller Capital believes the crypto market has reached the end of its bear cycle. The firm claims that Bitcoin and Ethereum have reestablished themselves above their 200-day moving averages, a phenomenon that has historically marked the end of bear markets in the past.

In a research note, Starkiller pointed out that both cryptocurrencies have experienced significant drawdowns, with Bitcoin falling by 54% and Ethereum plummeting by 70%. Despite these declines, they have managed to reclaim their respective 200-day moving averages for the first time since the end of the last cycle.

The firm has closed its short positions in anticipation of a market turnaround. In fact, it wrote that 'never short a dull market, especially at the bottom of the cycle.' Starkiller also noted that the timing of this recovery coincides with the average length of prior cycles, which typically range between 315 and 385 days.

The firm expects the rally to continue beyond Bitcoin and Ethereum, with revenue-generating protocols such as Hyperliquid Strategies (PURR) poised for significant growth. However, it also warned that not all crypto-native tokens will repeat their performance from the previous cycle, particularly those without genuine revenue streams.