5 Classic Crypto Top Signals

Calling the market top is the stuff of legends; these 5 signals may be key.
Jan 24, 20243 min read

In crypto, discerning the signals of market tops can feel like trying to read tea leaves. But where data meets market sentiment, you can often get a sense, rarely anything exact, of where the market might be headed.

In today's article, we take a look at five crypto-specific market signals that often precede periods of outsized corrections or volatility.

To be clear, this is all far from a science and is certainly not financial advice! Actually knowing when to pull the trigger is the art that crypto trader legends are made of, but below are five market signals (in no particular order) that, when taken in conjunction with other factors, are an interesting gauge for market froth.

5. ETH Gas Fees

Ethereum's gas fee spikes over 150 Gwei have consistently been harbingers of significant market adjustments and market tops that arrive weeks later.

For instance, gas spiked to 210 Gwei in March 2021, a month before April’s peak. Then, in October of that year, it rose to 157 Gwei – again, a month before Bitcoin’s all-time high! While, yes, gas did not reach the astronomical levels of earlier that year, this may be because of the rising prominence of Alt L1s around this time.

Moral of the story – when Gwei crosses 150, it may be best to start locking in gains.

What you could do:

Use a Gas Tracker to monitor the base Gwei cost.

4. Bitcoin's Halving Cycle

One of the more steadfast signals for market cycles, Bitcoin halvings have long been flagged as signals for market movement. This doesn't mean it's easy to pick the exact moment! Research from Pantera Capital suggests a tendency for the market to bottom roughly 477 days before a halving, with a subsequent peak about 480 days after.

Whether this continues to hold true is anyone's guess, but as we approach the next halving on April 19, this pattern suggests that the market could run up through 2024 into August 2025 (still, with corrections expected along the way).

Overall, the focus on Bitcoin's halving cycle shows investment cycles are more than a supply-demand equation; they’re about market anticipation. The halving spurs expectations of a price surge, often influencing market behavior. The impact of a halving unfolds over approximately years, highlighting a long-term market trend influenced by collective sentiment and anticipation — also known as speculation. 😉

What you could do:

Mark your calendar for Aug 12, 2025. 👀

3. Coinbase App Store Ranking

Coinbase's rank in the App Store has been another top signal often discussed among traders across crypto.

The app's rise to #1 on December 7, 2017, and October 28, 2021, closely preceded Bitcoin peaks on both December 18, 2017 and November 10, 2021. Overall, this type of correlation is fairly obvious, reflecting a surge in the kind of extreme retail interest where every old friend starts hounding you about what crypto to buy. In other words, perhaps a good time to take some profits.

What you could do:

Cash-out when Coinbase tops the App Store.

2. Ethereum Foundation Sales

The Ethereum Foundation doesn't make significant sales too often, but when they do, they've proven worth paying attention to.

In early December 2017, they sold approximately $131 million in Ether, timing that year’s December 18 top exceptionally well. On May 17, 2021, they sold $123 million in Ether a month after Bitcoin peaked on April 17, 2021. On Nov 11, 2021, they sold 20,000 ETH worth $95M – just one day after Bitcoin's current all-time high.

These are certainly not the only sales that the Ethereum Foundation has ever made, though they are among the few valued above $100 million. Take a look at their Arkham profile if you're interested in tracking these sales yourself going forward.

What you could do:

Sell when the Foundation unloads $100 million in a short time frame.

1. Crypto IPOs and Listings

Sorry, we had to. Crypto entering public markets has also been a major cycle signal.

One of the most pertinent examples here is the listing of the CME Bitcoin Futures in 2017. Bitcoin rocketed up in legendary fashion until the very day of the launch, at which point it began a two-month slide, drawing down BTC's price by 65%.

Similarly, the market rallied 848% up to the Coinbase IPO in 2021, when Bitcoin peaked at $64,863 on the day of the listing. It slid back 54% in the next several months before rebounding in spectacular fashion to new ATHs in November.

On January 11, Circle announced they had confidentially filed for an IPO. Circle already tried to go public in 2021 via SPAC, which failed. But when Circle’s IPO eventually gets a date, it may be time to take a close look at the state of the market and weigh your options.

What you could do:

Sell Circle’s IPO.

Not financial or tax advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This newsletter is not tax advice. Talk to your accountant. Do your own research.

Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. Additionally, the Bankless writers hold crypto assets. See our investment disclosures here.

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