If you look closely, there a handful of signs pointing towards crypto entering its last market cycle, before finally exiting its developmental phase and entering into it’s long-term era of maturity, stability, and growth.
“The next cycle is going to be the last one” is kind of a meme-statement in crypto-land. It’s been stated before, and we don’t intend to make a clear convicted prediction about this. We are simply connecting some dots across the digital asset landscape that point towards a new phase of crypto after this bear market is concluded.
Let’s dive in!
On regulation and institutional approval
Crypto is going through its largest regulatory battles ever. Indeed, this has always been inevitable. As an industry based around money and finance, cannot just walk into mainstream acceptance without going through the trails of regulatory acceptance. In order for the biggest players to be able to play in Web3, they need assurances of rules.
“Becoming mainstream” means that crypto makes it through these regulatory trials.
At the same time that we can start to see the light of the regulatory tunnel, we can also see the endgame for many the protocols that this industry is built upon.
By the time the next bull market rolls around, the costs of Web3 compute will have found their theoretical minimums. High gas costs and slow blocktimes will not be a bottleneck for the adoption of decentralized protocols. The responsibility of innovation will shift to the application devs, who will be charged with making use of the ample supply of compute resources supplied by the protocols devs.
Next bull market will not be constrained by limits on scale. No one will cite "high costs" and "protocol immaturity" as a reason why they did not integrate with Web3 systems..
This will open up access to the long-tail of crypto use cases. When Web3 are slow and expensive, the only use-cases that are accessible are money, finance, and high-value assets. If things cost tens or hundreds of dollars to do, then the only rational activities that can be supported are things that are worth thousands of dollars or more.
The race for the ETF has begun. The arc of history is defined by technology. It appears that time is sooner rather than later. Once Bitcoin blasts open the doors of crypto-asset ETFs, it becomes harder to stop additional assets from finding their way into their own ETFs.
Making some assumptions here, but we’ll get the BTC ETF and the ETH ETF won’t be far behind. If these things pair with the incoming bull market, the pipes of capital between crypto and the outside world will be the largest they’ve ever been.
This will pair with the above regulatory conversation. By the end of this incoming cycle, the ticker symbols B-T-C- and E-T-H will be commonplace next to APPL and AMZN, for every major brokerage in the world?
The cycles are diminishing anyways
Bitcoin returns over the years have always been suppressed. If you were insane enough to buy bitcoin in 2010, congrats because the rise to the 2011 was the steeping, sharpest increase in gains that Bitcoin ever had. Every subsequent cycle has taken more time for lower returns.
Obviously, it works this way.
One of societies biggest talking points are that crypto-assets are too volatile. Well, every cycle, crypto assets become the least volatile they’ve ever been, while simultaneously the traditional equities and bond markets are the most volatile they’ve been in over 3 decades.
With the easing of regulatory pressures, and the attraction of sustainable, non-speculative adoption of crypto networks due to the maturity of network infrastructure, a lot of the volatility of crypto can be damped simply due to adoption.
Digital Asset civilization grows
With next cycle, we’re going to see the civilizations establish. The safety and security of civilization.
Mainstream adoption requires roads, plumbing, laws, and policemen. The margins of digital asset will be clear.
Parts of crypto will start to be considered sufficiently safe and secure that Web2 normies will feel safe living it. Smart contract wallets with account recovery, highly battle-tested apps, high-trafficked L2s, Base… these things will become the civilization of crypto and will be a place where the less adventurous can still feel safe participating in digital asset market.We have made some assumptions based on market sentiment, we will see if progress will proceed quickly or if it will take some more time but technology, as we have already seen in the last 50 years sometimes runs faster than fiction.
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