When Will We Go Parabolic This Cycle? | RSA+DH

Bankless Station, we have a Bankless Takes episode for you because uh we wanted to just talk about get some of our ideas out there and the ideas going on and where we are in the current crypto cycle. Is it over yet? Are we about to enter all time highs? I don't know. We're in kind of like this flat zone. So what are we talking about today, David?

Yeah, there's a lot of conversations going on that I want to just elevate here on the episode today and uh just kind of unpack. Uh one of them is where exactly are we in this cycle? After three months of flat crypto prices, I think people are just like re-hashing out the conversation of like is this is this the bull market? Or maybe the bull market hasn't even actually started yet, and we were just like psyoped by a premature like bull market that was pulled forward due to like the Solana season and the Bitcoin ETF. Maybe the bull market actually just hasn't even started yet. So people are having this conversation. Also, people are talking about um the ether ETF and it might miss the mark in terms of flows and expectations, or it might do the opposite and enter the banana zone. Also, WTF is the banana zone. Uh so we have to kind of define that as

That's a that's like a Raul Paul term. And by the way, he he says banana zone. He he gives it this like incredible accent, which I think is but you know part of the reason it's it's picked up so well. Oh, because it's a meme.

Yeah, I mean just banana zone versus the way we say it is way is way better.

Also China is buying a lot of gold. Uh and so what's going on over there? And what does that have to do with risk on assets and what does that have to do with Bitcoin? Uh and not connected to anything else, but we'll also give a quick update on the Iggy Azalea meme coin because that's what everyone wants.

Do do we have to? Do you have to do that, David?

Depends on how long we go.

All right. All right, David. Let's get in. Where do where do we start this conversation from uh like where we are in the cycle perspective? Should we start with this tweet from Ignis? They start like this This bull run is boring.

You're asking.

I I gotta admit, I know I I I I prompted the question because I know you already put it in the agenda disorder, but um this bull market is boring is kind of a sentiment that a lot of listeners are probably feeling right now, right? Um, because I think I don't know what our attention span is in crypto, but it's gotta be a lot shorter.

Man has

Entertain everybody else. And so the last I mean we got the Ethereum ETF and we got a price bump, but it felt like a price bump for ants. And I'm back to being a little bit bored. Some people listening are back to being a little bit bored.

Well, I would also say that uh this has been a theme for a while, that this is the m the first like price appreciation, so if we even call it a bull market, just like the first time that number has gone up due to exogenous factors. Like in 2017 and 2021, we had activities in crypto. In 2017, there was the ICO movement, like regardless of how like toxic that ended up. Uh in 2021, in 2020, we had DeFi summer and and and NFT mints. There were like things to do and buttons to press. Now we definitely have the meme coin cycle, but that's kind of contained to mostly Solana. There's a few meme coins on Ethereum, but mostly like the the activities are in like the the the just the Solana camp, which is not which is not globally crypto. Like NFT mints happened everywhere across crypto last cycle. Uh and so I think this is one of the reasons why this bull market is like perceived to be like not as exciting is because we don't have any of our own like self perpetuating activities to excite us.

Yeah, there's less fun DeFi DGen stuff on the frontier. Like the DGen activity is all around meme coins and celeb coins, which I know you're dying to talk about the celeb coins, David. But like think about some of the the bankless uh podcasts this year, and um they've been incre incredibly important. Like the topics is just uh incredible that we're here in crypto, but it's been about the ETFs, right? Which is like okay, institutional finance finally giving a stamp of uh approval for crypto. I mean, that's cool, but like really, or or like uh government policy how many episodes.

Suppress about the ETFs.

Yeah, so or or we're talking about macro stuff and interest rate decreases, right? So where are the buttons to press? So it feels very PvP, it feels very boring for the um like the people who are crypto natives, I I think, at least among some of it, some of us. And the question is what's gonna bring it back? Uh Ignis says that you know, staking is cool, restaking this whole thing we've been talking about for a while, but it's also a little bit more for whales, right? So like if you have a lot of ether, if you have a lot of capital, you know, restaking that whole narrative is about what you can do with that capital. If you're new, maybe not so much. And um he he concludes by saying that the the next boom might come from consumer apps, right? So like you can see vestiges of this with like Fantasy Top, you know, pump, pump uh friend tech, pump.fun, other other kinds of games. We might see it there. This is uh Farcaster, daily active users, like kind of like going up, not quite hockey stick, but maybe the beginnings of something that is uh up only hockey stick. So the question on everyone's mind is what's going to bring retail into this market? Because it's um it's basically the same crypto natives that that we've had for the last 18 months. We're still here. Yeah, we're still doing things, but like there's no new crop.

Right. Point farming and meme coins is like that's for us. That's not like waking up people to the frontier of finance or to like the intersection of culture and and art and being on chain. That was all like 2021 stuff. So this this is like one of the motivations as to like why people think that you know maybe just because like Solana did like a 10x off the bottom, uh Bitcoin got its ETF. Uh maybe all of that stuff was because of endogenous factors, but the true endogenous crypto cycle hasn't started yet. And so this is what people are starting to like reflect upon. Uh base carbon says we are actually very early, and the real bull is 2025. But crypto Twitter has been too occupied with calling tops and posting the market cycle chart with where are we to realize it. Zeroth inning. We are still scouting rookies. Uh so this is a sense, this is uh emblematic of a sentiment that's been going around this week. It's like, no, we're actually in the zero inning of the bull market. The bull market has not yet started. Uh, and Van Spencer also gives a take that's aligned with this is like the bull run starts when the first rate cuts happen, by the way.

Okay.

Rates at 5.5% mean that we have a lot of room for things to get silly. Might want to get the rap playlist ready for the big up days. So also basically calling that like we have not even like shot any of the ammo that we have for a uh uh for a bull market. Now this it this is back into like the whole macro commentary. Uh but uh this has been a take that everyone has had is like when rates are at five point five percent, like they only have room to go down. Um

This is not the end of the bull cycle. It's not even the beginning of the bull cycle basically. We're we're that that is yet to come and that's gonna take us to V Valhalla.

Is is is a take, is a is a bull market take for sure. Uh and I I think it's it's really a matter of like, do you think that is it's possible that the so Solana and the Jito airdrop that just kind of like tugged the uh bull market cycle, like the curve cycle to the left. It like pulled forward a bit of the bullishness. Maybe because Solana was oversold as a result of FTX. Uh and then we got the Bitcoin ETF, right? And so it we got price appreciation without like internally native uh like room reasons to go up or like like the other bull markets, which were caused by like uh favorable macro policy.

So that's a take you have. Are are you saying, is that different than the take that Vance just gave, or the the other take that we read out where we're in the zeroth inning? We haven't even started. You're you're just saying that I think this is a David Hoffman tweet, that um a lot of the bull market activity has just been pulled up into like 2024 because of the Bitcoin ETF and also because of just like Solana had this epic rise from the bottom. And so are you saying that's inconsistent with the the real bull market is yet to come, or is this like the same thing?

Yeah, I think people are considering, myself included, that maybe these were idiosyncratic events that don't actually fit the pattern. And the real pattern is like the very typical, like insane cycle that we just haven't had yet. I think people are just trying to rationalize like why we've had three months of like sideways price action.

We're starting to get some price targets, not from crypto natives, but from TradFy. So maybe it's more significant when it comes from TradFi. I'm not exactly sure. But uh here are some Bitcoin price targets. 250K on the low end for this upcoming bull market. Uh Chamoff says 500k, 1 million at the high end. And this is Vance saying 250k still feels low to me. Only 30 to 40% of gold. Approximately zero millennials want to own gold. Um, I think, I mean, that's true. That's definitely true for me. I just like when crypto exists, why own gold? Uh, but Vance saying that 250k still feels low, but tradfy is is in that range. That's kind of the lower end of the tradfy estimates. You mentioned Chamath here. So this is like Chamath, notable investor, uh, you know, podcast host and the all in podcast, right? I I think I saw a clip circulating. I haven't watched it yet, but um Chamath, I think he's probably on all in giving his Bitcoin price uh estimates and the reasons why. Should we play this?

Yeah, so this this uh take clip from Tremoth happened after the all in Besties were talking about um uh the political favorability to crypto as a result of the Ethereum ETF and uh the the election. Uh and then Tremoth starts pivoting into uh Bitcoin price targets. So let's go ahead and get into that clip right now.

You should really

look at the pattern of Bitcoin

after a halving. So here's a little Bitcoin price analysis for you guys.

So there's been a couple of halving cycles that have happened. And I asked him

to go back and look at the price performance one month after a halv,

three months, six months, nine months, twelve months, and 18 months after a halving

and

what you notice is that there are

these moments

initially where essentially when you go through a Bitcoin halving,

People are sort of reassessing what's happening

and they're trying to figure it out. That's sort of what I would say is happens in the first month, and roughly what also happens

in the first three months.

But then within six months to a year and 18 months of these things, there are these

crazy price appreciation cycles

that happen. So that's what this page shows, which is, you know, 18 months

after the first halving.

The Bitcoin price returned 45x. After the second halving, it returned almost 28x.

And after this third halving,

it returned almost an 8x, which is really incredible returns in such a short period of time. If you go to the next page. And so if you if you graph that, this is what it starts to show, which is what is this price performance after each of these halving cycles.

Now, why is that interesting? Well, it's interesting because

on top of this halving, which

theoretically, if history

is a guide,

we should see some price appreciation.

Obviously, the other thing that's happened is we've commercialized Bitcoin. And we talked about this

sort of as my big prediction for 2024,

which is these ETFs are really going to allow Bitcoin to cross the chasm and have its

sort of central key moment, right?

And so if you apply the averages, and again, these are just averages, they're by no means predictions. Okay, so I just want to qualify that. These are just

not

financial advice. These are just guesses.

We took these and we applied it to the price of Bitcoin. And if you go to the next page,

You start to see what could happen

if you just take the average of the last few cycles. So, because the first cycle was so extreme,