Many Bitcoin fans dreamt that Legacy Finance Institutions would lead the way to mainstream adoption of Bitcoin.
This dream was the narrative that drove the last Bitcoin bull market. Now that we maybe in a Bitcoin bear market, that dream has turned out to be a nightmare.
Daily Fintech subscribers were told HOW this crypto-in a-suit bull market would end. If I could have told you precisely WHEN it would end Daily Fintech would be charging subscribers $143 per second not per year. In hindsight it is obvious that the day Coinbase went public and joined the Fintech 50 Index would mark the end of the bull market (to kaching sounds as Institutions sold COIN and BTC to retail investors).
I think there will be another Bitcoin bull market – I am a long term bull. I do NOT know when it will start. I do know that the narrative of the next Bitcoin bull market will be opposite of the previous bull market:
Bull market 1 in 2013. Cypherpunks, Anarchists & Libertarians (more interested in “sticking it to the man”than making money) created the early traction that got Bitcoin from an obscure message board to the possibility of game-changing innovation. The dramatic price rises brought in Retail Speculators hoping for a quick buck to recover from the 2008 depression)
Bull market 2 in 2017. Retail Speculators. Sticking it to the man was not high on the agenda. This brought in new capital and excited the Legacy Finance Institutions who drove the next bull market.
Bull market 3 in late 2020/early 2021. Institutions & Governments aka “the man”. This was when the Cyperpunks, Anarchists & Libertarians were thrown into the dustbin of history and the speculators are told to grow up and trust in the products sold by Legacy Finance.
The crypto-in a-suit bull market ended because Legacy Finance Institutions exist at the pleasure of Governments, so when regulators take action against Bitcoin the Institutions are vulnerable to pressure. A few whales could trigger a bear market, knowing that Governments acting would deepen the price decline.
The narrative of the next bull market will be the opposite of the recently ended crypto-in a-suit bull market. The Cypherpunks, Anarchists & Libertarians from 2013 will cheer from the sidelines but the Bull Market 4 narrative will be “First the Rest then the West” about billions of people interested in Bitcoin to help them “put food on the table”.
Daily Fintech articulated this “First the Rest then the West” Path To Mainstream Adoption 2 years ago. We are seeing signs of this in countries such as Venezuela and El Salvador.
This use case, with billions of people in countries with failing Fiat currencies, will build Bitcoin’s second leg – a currency for everyday spending.
These billions of users at the Bottom of the Pyramid constitutes an unserved market excluded from the modern consumer economy of about $5 trillion in Purchasing Power Parity terms.
The advent of fast, low cost micropayments via offchain technology such Lightning Network also make it much easier to profitably serve the Bottom of the Pyramid. Credit Cards obviously don’t work in that market and physical cash has hidden costs (theft, time, handling etc).
Nightmares (and bear markets) do end. This too shall pass.
Daily Fintech’s original insight is made available to you for US$143 a year (which equates to $2.75 per week). $2.75 buys you a coffee (maybe), or the cost of a week’s subscription to the global Fintech blog – caffeine for the mind that could be worth $ millions.