Markets
Economist Alex Krüger Says Bitcoin and Cryptocurrencies Are in a ‘Supercycle’: Here’s What He Means
Economist Alex Krüger says that Bitcoin (BTC) and cryptocurrencies are in a supercycle, and this time the market phase is expected to be more than a meme.
In a new discussion on A blocmates’ Orange podcast, Krüger says Wall Street and the world of traditional finance have “drastically” changed the market structure of digital assets.
Krüger says that given the new nature of cryptocurrency markets, downside volatility will be much more limited and buying pressure will increase significantly due to Wall Street’s pressure to increase its exposure to digital assets.
“The way we look at it is that we are in a supercycle. These words were used as a meme in crypto circles. They actually turned out to be a meme, unfortunately, because Bitcoin has fallen 86% top to bottom from 2021 to 2022.
But what supercycle basically means is that we no longer have declines or we no longer have corrections and we continue to rise: what it means is that future corrections will be shallow.
So we are not talking about corrections of 6%, but something like 20% or, in the worst case, 50% or 60% in the most extreme cases, and these do not last forever.
The main driver of this change is basically the arrival of Wall Street and ETFs (exchange-traded funds), which have radically changed the structure of the market.
And we’re going to a place where people need to have more Bitcoin in their wallets. Why do they need it? Because they’re going to be pushed into it by wealth managers and RIAs and basically everyone on Wall Street.
This is where we are going. Bitcoin ownership right now is very low on an aggregate basis and of course on wallets.
The narrative, the marketing pitch on Wall Street is that it should be around 2%. We are very far from that. So I think we can be somewhat confident in this supercycle view as long as we are far from that 2% and as long as Bitcoin’s market cap is such a small fraction of gold’s because that’s the second narrative, which is that Bitcoin is digital gold, and it’s being pushed very hard now.”
At the time of writing, the value of Bitcoin is $68,123.
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Disclaimer: The views expressed on The Daily Hodl are not investment advice. Investors should do their own due diligence before making high-risk investments in Bitcoin, cryptocurrency or digital assets. Please note that transfers and trading are at your own risk and any loss you may incur is your own responsibility. The Daily Hodl does not recommend buying or selling cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
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