What if the Bitcoin Super Cycle is Real?
There has endless debate for how this bitcoin cycle will end and where prices will go. Will it mimic 2017, or be more like 2013? Or will it be something completely different? For the longest time there was a general consensus that this cycle will be similar to all previous cycles. Where bitcoin starts moving upwards around 6 months after the bitcoin halving occurs, and then continues moving upwards for the next 18 months or so; ending with a parabolic movement sometime in December or January. Those predictions would place the end of the bull market either next month or 2 months away. This has been the general consensus of what will happen; because up until now, that is what has always happened. Although, there is a recent idea that has come on strong, and that is the "Bitcoin Super Cycle Theory." This idea believes that this bitcoin cycle will be unlike any other cycle before it. That it will not end 18 months after the bitcoin halving, but could last at the very least, another year, if not longer. Some have even proclaimed that this would be the "last cycle," meaning that this could be the last time where bitcoin moves in these 4 year cycles and begins to move upwards in a more calculated manner. This has been a divisive debate with vocal people on both sides strongly believing in their own beliefs. That it will either be regular cycle that will soon come to an end, or the super cycle and the start of something that we've never seen before.
If I could stress a philosophy that you need to have to be successful in this space; it is that you need to have strong conviction, but also be very open minded. Taking that into account, even if you have doubts about the super cycle idea, you need to be asking yourself one important question. What if the bitcoin super cycle is real?
Along with this initial question, also comes a secondary question. Did you do enough?
When the price of bitcoin begins approaching all-time highs, I always go back to my experience in the summer/fall of 2020. Bitcoin was in a $10,000 doldrum where it could not go above or below. It was doing nothing, and many people complained that it was boring and too expensive. I had my conviction and continued going all in. Then the market became exciting and bitcoin approached it's previous all-time at $20k. Again, people were proclaiming that it was too expensive. That it needed to re-test $10k again. But you already know the rest. It didn't, and has since gone all the way up to $69k. Now people are saying the same things. Bitcoin is too expensive to buy, you can't make the huge gains with it anymore. My approach hasn't changed. I continue to go all-in on bitcoin without taking my foot off of the gas pedal. I could be wrong and there could be a huge correction coming. But let me ask you this. Which type of person would you rather be. The person who has full-conviction and went all-in on a project that they believe in. Believing that it will go up in value, but unfortunately not being correct. Or being a fan of bitcoin, but not having full conviction. In this scenario you are just sitting on the sidelines while the price continues to go up, waiting for that correction that may never come.
The markets are different than they were just 2 years ago. Covid, money printing, inflation, stimulus and distrust of governments changed everything. I have said this before, but will say it again here. I truly believe that the Covid situation and everything that come along with it, sped up the adoption and image of bitcoin by at least 10 years. If not more. Without that taking place, I do not see a company like Microstrategy converting their balance sheet to bitcoin. I do not see a country like El Salvador making bitcoin their legal tender so quickly. The world has changed and you need to be ready for that.
So what does a bitcoin super cycle look like? That is the question that everyone wants to know. While I am far from an expert, I could see this bull market lasting until the next bitcoin halving. There may be mini bear markets like we experienced, but nothing like we've experienced in the past. If the cycle does happen, the world will turn to bitcoin. Right now only a hand-full of major companies have put bitcoin on their balance sheet. But in this scenario it would be rarer for a company to not have it. El Salvador will be the country that opened the floodgates and set the tone for other countries. Other countries will soon follow and soon we will have 10 countries that have made bitcoin their legal tender. The thing about this that you need to remember is that when countries adopt bitcoin as their legal tender. This is when the game theory really comes into play. It makes it so that countries will be putting themselves at a complete disadvantage if they don't at the very least, heavily invest into bitcoin. One these types of events begin to take place, that is when the price of bitcoin will go to unimaginable places. But that will happen beyond this initial super cycle. While the price of bitcoin is expensive right now at over $65k, especially for those of us who have been in this market for years. If this bitcoin goes to the places that many of us believe that it's heading towards, then it is still cheap. People who believe in a standard cycle have made BTC price predictions of $100k. But in this super cycle, that would be incredibly bearish. People have seen PlanB's price prediction or $288k within the next few years and even that could be a low estimate. If, and this is a big if, bitcoin has a super cycle, I think we should be setting our sights on the market cap of gold. This would put bitcoin at a price of around $500k, or a $10 trillion market cap.
Now, this is all a "what if" scenario, and there is probably a larger chance that it doesn't happen, than it does. But, even if it doesn't, it is highly likely that bitcoin still reaches those numbers on a timetable anywhere from 5 to 10 years from now.
But here is the main question that you need to be asking yourself! What if the bitcoin super cycle is real?
Have you done enough? And how will you continue to accumulate as the prices soar? How will you store your assets?
Personally I would always have the regret of having done too much, then not done enough. That is why I'm going as hard into bitcoin at the same level as when it was $5k. As for continuing to accumulate. Of course I will continue to buy spot, use writing earnings to convert into bitcoin as well. But also will be taking advantage of loaning out bitcoin to earn a passive income. Years ago, I foresaw where the prices were going, and wanted to insure that I have a way to earn btc passively. And finally, if bitcoin goes to those incredibly high prices. You need to know how to store it properly. If your BTC holdings rise in value from a few thousand dollars to potentially hundreds of thousands or more. Than it might not be a good idea to store it on an exchange, on a phone wallet or anywhere that can be easily accessed. Cold storage could be more important than you even realize.
Again, this is a big "what if" scenario, but just look at the world the last few years. I think most of us would agree that the chance of this happening is definitely much higher than it was a few years ago. The question is; Are you ready?
As always, thank you for reading!