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1/ I’d like to talk about crypto market cycles. Turn the clocks back to Jan 2017, $ETH had zero interest, people thought it was dead, and it was just 6 months after the DAO hack. $BTC didn’t have much enthusiasm either only thing people were talking about were an ETF ruling in
2/ March 2017. Leading into March $ETH began gaining traction from a combination of savvy investors who saw the power of smart contracts and the initial formation of the EEA. Hundreds of companies committed to building and experimenting with $ETH
3/ in efforts to improve operational efficiencies and explore nascent, yet promising technology. This started the first initial fomo and the break past the ATH before the DAO attack was surreal. Most people didn’t think it would ever recover.
4/ Investor interest continued to bubble on the merits of smart contracts. A few ICOs (BAT, BNT, GNO, SNT, etc.) launched raising tremendous amounts of money. This bubbled in early June 2017 amidst irrational conjecture that $ETH
5/ would flip $BTC in market capitalization. I’ll use the ETH/BTC pair to support the view that the bubble was triggered by renewed interest in $ETH then led to an ICO craze, profits siphoned to $BTC, then $BTC profits back to ETH. ETH/ERC-20s will ignite the next bubble as well.
6/ Following this crash, several projects popped up trying to capture the smart contract market share, notably NEO with their rebrand. Anyone remember that shitcoin? Yeah no one else does either. By the fall, renewed interest in crypto prompted fresh money to enter via $BTC.
7/ This push increased the $BTC dominance and crushed alts. ICO speculator profits largely went back to $BTC continuously pushing up its price and increasing fomo. This culminated in the ATH in late 2017, profits momentarily shifted to $ETH and other ERC-20s, which hit their
8/ respective ATHs about a month later. The bubble started crumbling shortly after with a final dead cat bounce in May 2018. The unreasonably high valuations became apparent and the alt coin market collapsed.
9/ So to recap: ICO speculators took profits in $BTC pushing up its price and dominance. $BTC was the reserve currency of the space, and its primary use-case was not a store of value, but a medium of transfer between ICO shitcoins.
10/ Less widespread use of stablecoins also supported its price. Thus, all profits flowed back into the reserve, which was $BTC and led to a positive feedback loop for its price. Hence, BTC maximalists are the biggest shitcoiners in existence (stacking sats).
11/ A Cambrain Explosion led by prominent DeFi projects has been leading the space again and basically pulling $BTC up. I see this as a possible scenario: this mini alt bull run continues to the end of the summer and then $BTC has a nice rally testing 15k and maybe a run to ATH.
12/ BTC dominance sees an uptick. $ETH 2.0 phase 0 hype starts picking up around November/December and continues to take market share. You didn’t think the DeFi sector wouldn’t
13/ accrue value to $ETH did you? ETH/BTC already bottomed twice at .020 ETH/BTC and will continue trending up, likely reaching 0.070+ once fomo starts really hitting in. Profits then go back into the bigger and prominent DeFi coins with real usage.
14/ This is the golden, fabled bull-run that continues for 24-36 months, with a notable drops, but overall the trend will be upwards. This is a multi-trillion dollar market and 1 or 2 coins will be trillion dollar caps. So what does the future look like?
15/ You will be able to buy a synthetic AAPL share, immediately swap it for an equal amount of synthetic gold. Sell half the gold to your friend Chester and have smart contracts trigger a wire from his bank account to yours.
16/ Then you can go to 7/11 ( you do go to 7/11, right) scan your QR code and withdraw $200 from the cashier using your stablecoin balance, which is accruing optimized interest using @iearnfinacnce (subtle shill). Powered by @chainlink oracles, secured by $ETH.
17/ DeFi is still primarily concentrated by degens that have stuck it through the bear market. True institutional players haven’t entered yet. Even large BTC holders haven’t even heard of DeFi. @chamath is one of the largest BTC holders, and as of June he hadn’t even
18/ heard of it. That’s how early this is. Think about that. $BTC market dominance will be in the 35-45% range with a multi trillion dollar marketcap. BTC maximalists will be in disbelief. It’s just a dip right?
