By its definition, a Supercycle is a financial phenomenon whereby a specific asset – in this case BTC – enters into a bullish loop of positive feedback. Hence, the actual and new investors attract more people to buy the asset, causing the price to soar exponentially.
We know that commodities can rally up for decades – of course, not at the same levels as cryptocurrencies – but can we talk about a BTC supercycle? Is it real at all? What evidence do we have? We will discuss all of these issues in the following sections.
What evidence do we have about the BTC supercycle?
Since the COVID dump in 2020, this is the first time we’ve had three monthly closes in red. To several technical analysts, this is a confirmation of the BTC supercycle due to the following reasons:
- It gave BTC and the entire crypto market a much-needed relief – similar to what we experienced in May, with a flash crash that ended up being a multi-month bear market. BTC took a breath along with other cryptocurrencies, which in return, allowed them to reach new ATHs
- It allowed the market to flush out “paper hands”, investors without the necessary patience to hodl through the market, and even worse, without the intention to add more money into the market
- Now we have institutions investing in BTC and other cryptocurrencies. We even have institutions interested in buying crypto options – perhaps on platforms like Bitlevex or FTX – to hedge against risk and/or add exposure to the market. We even have nations like El Salvador investing in BTC, and more specifically, buying the dips.
This was a much-needed reset, which according to the expert, is a clear proof that the market will keep pumping. Not everyone agrees on a Supercycle that will last decades, but most agree on an extended-bull cycle.
Perhaps, this will change the way we see BTC cycles – with 6-12 months of bull market and 3-4 years of bear market. According to experts, we may see multi-month bear markets followed by constant bullish rallies. However, that’s yet to be seen.
More fuel than ever before
As we mentioned, nowadays we have more institutions and even nations engaging in BTC and crypto investments, and that’s only going to make things better for everyone. Since there’s a lot more trust and it’s easier to access the crypto markets, the retail will have both more motivation as well as more resources to invest in BTC and cryptocurrencies.
Furthermore, we have strong narratives such as DeFi, Play to Earn, virtual land and metaverse, with big players such as Facebook behind them, which will only fuel up the growth of BTC and cryptocurrencies.
Therefore, now we have far more elements that will support and fuel this positive loop of feedback that will keep the market cycle running for longer.
What can we expect?
We shouldn’t expect a never-ending bullish run, but instead, a macro bullish market with some periods of bear market. Instead of waiting 3-4 years for the crypto markets to pick up steam, now you will only have to wait some weeks or months. Then, you can expect BTC and cryptocurrencies to pick up momentum.
Therefore, you can make a good ROI in less time. Of course, you will have less time to accumulate, but by selling at the right time during the bullish rallies, you can use those profits to buy during the bear market. And then, it’s all a matter of rinse and repeat until the Supercycle ends.
What should you do during the BTC supercycle?
You should focus on the following:
- Buying good and promising projects while they are cheap
- Sell your position gradually
- Use your profits to strengthen current positions or buy new cryptocurrencies during the bear market.
As we have said before, the Supercycle is expected to behave this way, and hence, we can profit more from it in less time. That’s a pretty good deal, since by timing up the market correctly, you can obtain an outstanding ROI that you can use to grow your portfolio even more by buying cheap during the bear market and selling higher during the bullish run.
As always, only invest money you can afford to lose. With your crypto profits, on top of buying cheap crypto during bear markets, you can also invest in other assets such as gold, silver, stocks, land, real estate, etc.
Final Thoughts
This is the evidence we have so far now that we are in a BTC Supercycle… What do you think about it? Bear markets are getting shorter and bullish runs are getting more frequent. Let us know what you think about this in the comments section, and what your tips are to take full advantage of the Supercycle.