Thread by @JackNiewold

A MEGATHREAD ON THE SUPERCYCLE

🧵👇

AN OVERVIEW:

With most of Crypto Twitter bearish right now, it seems like a big chunk of the market thinks that this crypto cycle is over.

Simultaneously, industry insiders see this latest move as confirmation of a supercycle.

Wait, a confirmation?

How?

1. THE CASE FOR THE SUPERCYCLE:

Three Arrows Capital @zhusu was one of the first to set forth the idea of a supercycle in the crypto mainstream.

Zhu's idea of a supercycle is that:

• adoption steams forward rapidly
• institutional and mainstream capital comes into the space
• a P2P 'internet of value' removes middlemen and distributes ownership to users

"The odds of a long-term bear market drastically decrease."

But my favorite description comes from @cobie's description of a supercycle on his UpOnly Podcast.

(Linked here, starts at 59:32, paraphrased in following tweets)

"You can look at some actual supercycles...the Apple annual chart, the last, like, 12 years were just green.

And I think about it, some people got liquidated in those (laughs)...Some people's LONGS got liquidated in those."

"If crypto does become integrated into society, becomes the financial backbone of society. Bitcoin becomes...a vacuum for store of value from other things.

Then in that scenario, a supercycle is the only thing that really makes sense..."

"It's working, it's integrated into reality, it's just going to go up for...10, 15 years or whatever

I think the crypto Twitter version of the supercycle is a quixotic idea that has no real premise in reality, that there's never going to be a dump"

This is how @Cobie sees the supercycle: an inevitability (at some point) of mass adoption and capital inflows.

For now, he sees three real meaningful integrations of crypto into society:

• Bitcoin is now seen as a serious and important asset
• TradFi is exploring services in crypto
• Ethereum NFT speculation has gone mainstream

Is this societal integration an early, leading indicator into a supercycle?

Or is there simply not enough momentum here for a supercycle?

One of my colleagues at @cryptoprag, @knowerofmarkets wrote a phenomenal piece on this exact idea. (It's linked below)

He cites the following as reasons why there, in fact, IS enough momentum in the system.

theknower.substack.com/p/most-exclusi…

He (@knowerofmarkets) cites the following:

• Uncountable institutions and corporations buying BTC
• TradFi banks doing fundamental analysis on DeFI
• @Jack resigning from Twitter to work on $BTC
• Zuck changing his company's name to Meta
• China banning Bitcoin (yet again)

THE CLOSING STATEMENT:

Crypto is a decentralized, peer-to-peer, inflation-hedging asset class worth 1.5% of the world's GDP in the midst of unprecendented turmoil and inflation.

How the hell could we NOT be in a supercycle?

2. THE CASE AGAINST THE SUPERCYCLE

@Cobie describes the logic behind a supercycle very well, but as to his personal thoughts on if we are in one?

Cobie: "I lean probably towards no... I think it's the right idea but the wrong time.

It (crypto) is not connected to the real world, I struggle to see how we can have a supercycle until there are signs that that's changing"

His basic point? For now, there's no real link between crypto and economic reality for most of the world. If crypto implodes:

• Some investments disappear
• High-inflationary countries are affected

"But the main impact is probably to people that play Axie Infinity as a job."

An asset class reaching critical mass and worldwide product-market fit NEEDS a to have a more serious impact than the above, right?

Perhaps institutions are waiting for another boom-bust cycle to enter.

Maybe dog coins sitting comfortably inside the top 15 means it's too early.

Analyst/gigabrain @adamscochran recommends we watch on-chain for a confirmation or denial of the narrative:

His verdict? Whales and funds aren't buying.

Where's the money?

What are they waiting for?

Last week, @bigdsenpai asked OGs if we had hit max pain.

Here's what they had to say:

The consensus, then, is that we are very, very far from max pain.

Sure we've flushed out some retail investors, sure $TIME/Wonderland investors have been screwed.

But there's a long way to go down.

THE CLOSING ARGUMENT:

If we are in a supercycle, where are the buyers?

Where was resistance at ATH, 60k, 50k, and 40k for Bitcoin?

Why are coins with strong fundamentals down 80%?

With these market conditions, this far from max pain, how could we POSSIBLY be in a supercycle?

Both arguments are compelling.

Only the future will tell us if we are staring down the barrel of Up Only or if we're headed for a crypto winter.

What will you do, anon?

Are you bidding, or are you dumping?

The lady, or the tiger?

Thanks for reading, you can do me a huge favor by:

1. Giving me a follow: @jackniewold
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https://twitter.com/JackNiewold/status/1488615107424886784?s=20&t=gy-mlOm3JrtkN0kcDQSSGw