Hi, this is Aidar. Let’s look at the market without romance or dogmas. Part of the community is still counting down to the next halving and hoping past bull runs repeat. The other part has accepted reality: the crypto market’s structure has changed, and so have the rules. Below—why the old models no longer pull their weight, how Bitcoin became a savings instrument, why altcoins stopped delivering “X’s,” and which approaches make sense in the new environment.
Why classic cycles no longer steer the market
- The “sacred” 200-week SMA stopped being a floor. For years it served as a bottom gauge—until 2022, when BTC fell below what many considered an unbreakable level. The takeaway is simple: a historical pattern lost its predictive power.
- Stock-to-Flow no longer fits reality. The model focused on supply scarcity and halvings while largely ignoring demand. The result—valuations far above the actual price and little practical use today.
- Scale matters. When market cap was in the hundreds of millions, doubling price required relatively modest inflows. On a trillion-dollar market, moving the needle needs different capital. The logarithmic growth curve flattens; volatility declines.
What to track today: a “fair value floor” frame
Bitcoin Power Law is one of the few empirical models that still doesn’t contradict data. In essence, it’s a regression defining a long-term lower bound for the network’s valuation. In past stress phases the market didn’t break below it; the current reference zone is around $43,000. It’s not a “tomorrow forecast,” but a band where the asset looks statistically undervalued. Use such levels as a risk-management frame—not as a scheduled entry point.
Institutions rewrote the demand–supply balance
The biggest shift of recent years is the buyer profile. Retail used to “push” price; today flows come primarily from funds, ETFs, and corporate treasuries.
- Balance-sheet accumulation. Over a year, corporate and fund wallets increased BTC holdings from about 500k to roughly 1.1M coins.
- ETFs as an additional liquidity pump. Exchange-traded funds have acquired roughly 600k BTC (based on public data).
- Primary supply deficit. Post-halving mining adds only about 0.8% new coins per year, while institutional absorption is estimated at 5–6% of supply annually. Add long-dormant UTXOs (coins unmoved for >5 years), and liquid free float keeps shrinking—price can rise even without retail euphoria.
Why BTC has firmly shifted into “digital gold”
- Behavioral shift. Active address counts have been flat for years, while long-term holders and institutions keep growing. BTC is used less as a payment rail and more as a reserve asset.
- Contrast with fiat. The U.S. monetary base expands by roughly 6–7% per year; real inflation erodes purchasing power by about 3–4% annually. Against that backdrop, an asset with programmatically declining issuance looks like a natural hedge.
The “more risk → more return” myth doesn’t hold in crypto
The popular advice “chase X’s in alts” isn’t backed by this cycle’s stats. Of the top-100 altcoins, only a few outperformed BTC; most lagged substantially, and many dropped 50–90%. A simple top-100 alt basket underperformed plain BTC hodling over the past year—at much higher risk.
Why alts slump even in uptrends
- Unlocks and vesting. Large volumes of new tokens hit the market weekly. If demand doesn’t scale accordingly, prices sag.
- Early-investor behavior. Funds/insiders with low cost basis realize gains when retail arrives late.
- Lack of institutional demand. Big money favors liquid, reporting-friendly assets—BTC. Most alts don’t fit mandates.
What works in the new paradigm: principles over guesses
- Long horizon and BTC beta. Bitcoin is the core asset with the best liquidity and structural demand. It’s sensible to build the portfolio’s nucleus around it.
- Models as frames, not oracles. Use Power Law and long-term bands to judge risk/return, not to “guess Friday’s price.”
- Systematic strategies over “hoping for altseason.” In uptrends—ride momentum; in ranges—harvest premia via cross-market/stable-arb; in drawdowns—hedge delta (options/futures) and keep dry powder for rebalancing.
- Liquidity discipline. Account for real frictions: spreads, depth, network fees. On L2/bridges, pre-check limits and confirmation times.
- Risk control. Define portfolio max drawdown, automate exit/hedge rules, avoid ramping exposure into tokens with imminent large unlocks.
Bottom line
Old “magic levels” and calendar cycles lost their bite. The market has matured: prices are driven by institutional flows, shrinking liquid supply, and demand for a store of value. In this setting, Bitcoin acts as digital gold, while chasing “X’s” in alts often adds risk without adequate premium. Focus on principles—fair valuation, risk discipline, systematic tactics—and the market starts working for you, not against you.
Disclaimer: This material is analytical and not investment advice. Cryptoassets carry elevated risk. Assess your risk profile and consult a professional before making decisions.