Crypto volatility is\u00a0back.<\/p>\n
Bitcoin (BTC) dropped 30%. Meanwhile, prices of Ethereum (ETH) and Solana (SOL) got cut in\u00a0half.<\/p>\n
In total, the crypto market has shed $1 trillion since December.<\/p>\n
Many crypto investors are wondering \u201cwhen will crypto stop going\u00a0down?<\/strong>\u201d<\/p>\n But seasoned veterans know this pullback is nothing out of the ordinary<\/strong>.<\/p>\n After the 2016 US presidential election, bitcoin price surged through December before falling 38% starting in\u00a0January:<\/p>\n Source: TradingView<\/em><\/p>\n The same happened after the 2020 election. Crypto prices rallied into the new year, then fell 32% in early\u00a0January:<\/p>\n Source: TradingView<\/em><\/p>\n Notice the\u00a0pattern?<\/p>\n This time around, BTC peaked on January 20 and is again down 30%. Right on\u00a0script.<\/p>\n What matters is that BTC has been substantially higher 12 months after each of the past three presidential elections (2012, 2016,\u00a02020).<\/p>\n I bet we\u2019ll see the same scenario play out again. Making this a great buying opportunity.<\/p>\n Sentiment among crypto investors in recent weeks has dropped to levels last seen during the FTX collapse:<\/p>\n Source: Coinmarketcap<\/em><\/p>\n For sentiment to be hit \u201cExtreme Fear\u201d, surely, we must be witnessing another industry-shattering collapse\u2026 right?<\/p>\n What\u2019s actually going on is that crypto has been absorbed into the global macro trade. It\u2019s moving in lockstep with the stock market correction<\/a>, which is under pressure as investors grapple with uncertainty around\u00a0tariffs.<\/p>\n In times like these, it\u2019s important to have a long-term view. Focus on fundamentals.<\/strong><\/p>\n This has been the most bullish month for crypto (maybe\u00a0ever).<\/strong><\/p>\n Let\u2019s examine what\u2019s actually happened in the past\u00a0month:<\/p>\n The US Securities and Exchange Commission (SEC) dropped its lawsuits against Coinbase (COIN), Robinhood (HOOD), Uniswap (UNI), Binance, OpenSea, and\u00a0Gemini.The SEC created a Crypto Task Force focused on providing regulatory clarity to the industry.Operation Choke Point 2.0\u200a\u2014\u200athe banking blockade against crypto\u200a\u2014\u200awas officially ended.The harmful SAB 121 rule that made it impossible for banks to hold crypto was scrapped.The biggest banks in the world, including Bank of America (BAC), stated they\u2019ll offer crypto services.President Trump signed an executive order creating a Strategic Bitcoin\u00a0Reserve.<\/p>\n The disconnect between prices and fundamentals is unprecedented.<\/strong><\/p>\n BTC prices have followed a \u201c3 up, 1 down\u201d pattern. We call it the bitcoin 4- year\u00a0cycle.<\/p>\n Every fourth year, crypto prices plunge. The last time that happened was in\u00a02022.<\/p>\n Markets then recover slowly, with the biggest gains being handed out in years 2 and 3, as this table of bitcoin\u2019s annual returns\u00a0shows.<\/p>\n Year 2 was 2024, and year 3 is\u00a02025:<\/p>\n We\u2019re in what has historically been the best time to own crypto\u200a<\/strong>\u2014\u200athe \u201csweet spot\u201d that\u2019s typically produces the biggest\u00a0gains.<\/p>\n And if you think the four-year cycle is a myth, have a look at this\u00a0chart.<\/p>\n It compares this bull market with the last\u00a0two:<\/p>\n Source: Glassnode<\/em><\/p>\n Just look at how closely the current bull market (black line) mirrors the last two markets (red and blue lines). Until this correlation breaks, it\u2019s best to use it to your advantage.<\/p>\n I understand these selloffs can be scary, especially if this is your first time experiencing a drop like this in\u00a0crypto.<\/p>\n Remember, since 2010, bitcoin (BTC) has experienced 16 separate 30%+ corrections. That\u2019s roughly one per year. And yet it was still the top-performing asset.<\/p>\n Bottom line: Crypto has likely bottomed.<\/strong><\/p>\n These are great prices to buy quality\u00a0cryptos.<\/strong><\/p>\n Fundamentals have never been better. You got the 4-year cycle at your back. And you get to benefit from discounted prices.<\/strong><\/p>\n Ethereum<\/a> and Solana<\/a> are your safest bet\u00a0here.<\/p>\n If you\u2019re looking for smaller cryptos with higher upside, focus on quality. Don\u2019t go buying something stupid like meme\u00a0coins.<\/p>\n Choose cryptos with real-world business models making real\u00a0money.<\/p>\n I recently wrote a report on three such\u00a0cryptos<\/strong><\/a>.<\/strong><\/p>\n One crypto is disrupting Google. The second one has built an Airbnb for AI chips. And the third does business with big brands like Disney, Netflix, HBO, Apple, and\u00a0Nike.<\/p>\n Click here to read the full\u00a0report<\/strong><\/a>.<\/strong><\/p>\n For more insights and analysis, subscribe to The\u00a0Jolt\u26a1<\/em><\/a>.<\/em><\/p>\n We publish fresh research every Monday and\u00a0Friday.<\/p>\n \u2014 Stephen McBride, Chief Analyst at <\/em>RiskHedge<\/em><\/a><\/p>\n More proof crypto is bottoming.<\/a> was originally published in Coinmonks<\/a> on Medium, where people are continuing the conversation by highlighting and responding to this story.<\/p>","protected":false},"excerpt":{"rendered":" Ever heard of the post-election pump &\u00a0dump? Crypto volatility is\u00a0back. Bitcoin (BTC) dropped 30%. Meanwhile, prices of Ethereum (ETH) and Solana (SOL) got cut in\u00a0half. In total, the crypto market has shed $1 trillion since December. Many crypto investors are wondering \u201cwhen will crypto stop going\u00a0down?\u201d But seasoned veterans know this pullback is nothing out […]<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-56038","post","type-post","status-publish","format-standard","hentry","category-interesting"],"_links":{"self":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/56038"}],"collection":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=56038"}],"version-history":[{"count":0,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/56038\/revisions"}],"wp:attachment":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=56038"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=56038"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=56038"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}This is the classic post-election pump-and-dump pattern we\u2019ve seen in past crypto\u00a0cycles.<\/h3>\n
I\u2019ve never seen a bigger disconnect between prices and fundamentals in\u00a0crypto.<\/h3>\n
And don\u2019t forget. The best part of the bitcoin cycle is still ahead of\u00a0us.<\/h3>\n
A year from now, this will look like a great buy-the-dip opportunity.<\/h3>\n