Bitcoin Could Be Approaching a Double Top Pattern Similar to 2021
Bitcoin is different from what it was in 2021 in many ways. It has distanced itself from FTX and other shady parties in the industry and is now a mainstream financial asset, widely adopted by investors and traders. Bitcoin ETFs are also traded on the stock market, and more investors are exposed to the asset than ever before.
However, there's one way in which Bitcoin isn't that different from how it was in 2021. It's the financial metric that signaled the downturn that happened that year. There are warning signs again that are similar to those in 2021, and some investors have taken note.
What Happened in 2021?
In April of 2021, the Bitcoin price was at the record high of $65,000. This happened after a large purchase of Bitcoin drove the price up and caused excitement among the community. MicroStrategy purchased a large amount of Bitcoin, and Coinbase issued an IPO.
In just two months, the Bitcoin price crashed to $28,000, signifying one of the largest downturns in crypto history. Within the same year, the price of Bitcoin returned to $69,000.
Are We Seeing the Same Pattern in 2025?
There are a few similarities between the two scenarios that we can observe in the past couple of weeks. RSI (Relative Strength Index) is showing bearish divergence. This means that the price of Bitcoin is rising, but the strength behind it is weakening.
Trading volume is down, meaning that fewer investors are buying Bitcoin than in the previous year, which was also the case in 2021. Open interest on Bitcoin futures is also dropping, showing that the market doesn't trust that Bitcoin will continue to rise in the years to come.
Another similarity comes from the so-called hype cycle, which is somewhat similar to that of 2021. At that time, the hype came from a few large purchases, which proved that there's interest in Bitcoin as an asset. Now, the hype has emerged due to the greater involvement of the traditional finance market.
How are the two Different?
Even though there are some similarities between the markets in 2021 and now, there are also differences that may indicate that the outcomes will be different too. These are mostly about broad differences in terms of the crypto adoption itself.
Different Investors and Market Participants
In 2021, most investors buying and selling Bitcoin were retail investors. Now, in 2025, the market is dominated by institutional investors such as hedge funds, ETFs, and public companies. This shows that the market has changed and that cryptos are treated differently, just four years later.
New Technology
Crypto mining has also changed a lot since 2021. It was mostly done by individual miners using their own equipment, which was costly and consumed a lot of energy. In 2025, it's easier to install a crypto mining app and share the burden of organizing the infrastructure with other app users, and with the same effect in terms of production.
Market Structure
Market structure isn't the same as it was in 2021, indicating that the price of Bitcoin won't act in the same way either. In 2021, the market was far less regulated, which was one of its main appeals for many investors. Centralized players like FTX also played a bigger role. Lending companies were also much more involved than they are now.
ETFs and the involvement of traditional financial companies have made the crypto markets much more regulated, as it was the only way for ETFs to be bought and sold on the stock market.
The Introduction of Decentralized Finance
Decentralized finance didn't exist in 2021, at least not in the organized and widely accepted form that exists today. Now, it's a market worth nearly $6.3 billion and one that keeps growing. Decentralized exchanges are the only way for many investors to trade crypto in 2025.
What Does it Mean?
Experts and investors alike are noticing the patterns from 2021 repeat, and some have been scared by the prospect. However, when a broader context is taken into consideration, most would agree that the market is much more complex now and that there's little chance that Bitcoin's value will act the same as it did four years ago.
Even though Bitcoin has experienced ups and downs lately, mostly due to the forces outside the crypto market, the best practice remains to buy and hold Bitcoin, as it will recover through these downturns, as it did before.
Conclusion
In conclusion, the similarities between Bitcoin price patterns have caused debate online. However, those similarities are mostly superficial, and those who dive deeper into the market analysis see just as many differences alongside a different market ambiance altogether. The patterns are therefore not a reliable indicator of further market changes.
