Bitcoin, Crypto and its Cycles

With every cycle, market cap becomes bigger and yes indeed there is more money to be made.

Eg. You can sink 1 mio easily in the current big alt market which has several players and large cap alts eg. Link,Eth

However, as the market develops, more advanced players enter the realm.

From my exp in tradfi and market cycles for > 10 yrs, the chance of the typical retail coming out profitable diminishes w each cycle.

2010–2012 — Just buy Bitcoin, buy 10,000 BTC

2013–2017 — Buy an altcoin w just a whitepaper or get an airdrop , EOS, BCH, XEM,NEO

2018–2021 — DeFi, Liquidity Mining, Derivatives

As you can see over each cycle, the market gets more n more complex and attracts more advanced players simply because now a fund can sink 100 mio and be profitable compared to in 2011 when the market was so tiny and does not interest them.

In insti banking, we have large clients that hedges OTC options, structured products that are crafted by the most intel ppl meant to make money for the bank almost always and not necessarily for the client. Eg. Dbl Barrier Options, Seagull, etc.

So w comparison to the forex, equity markets — Online trading only become a thing in 2003–2004 before that retail barely had any skin in the game mostly large companies.

If you look at the charts, fx pairs used to trend so much cleaner until the HTF and algo guys came in 2007.

Conclusion: There will come a day when crypto is now ‘ tradfi’ and a lot of traders will no longer be profitable simply because it takes a lot more speed, wit, risk management to be so.

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store