"THEY All LIED! Everyone Is 100% WRONG About this Bitcoin Cycle" - Lyn Alden

[00:00:00]I I don't think the four-year cycle it is really functionally relevant anymore.

[00:00:04]Uh it still I think has some um kind of mental uh relevance in that people if if people expect [music] something they can kind of be a self-fulfilling prophecy.

[00:00:14]Uh but I think for the past cycle or two it's not really mattered. So earlier on the four-year cycle was really relevant because you had less coins in the market, you had more coins coming out with each block. Bitcoin now has a supply like annual percentage supply growth of less than 1%.

[00:00:32]Uh and the vast majority of of kind of, you know, marginal buying and selling of coins, prices are mostly set by how much uh longer-term holders are selling and at what prices versus how much new demand's coming in. That factor is 10 times bigger than, you know, how many coins are hitting the market with every block.

[00:00:54]Um uh just because that number is so small now.

[00:00:56]>> Bitcoin investors have spent years building their expectations around one simple idea, the four-year cycle. Every having cuts new supply in half, scarcity increases, demand eventually overwhelms sellers, and prices explode higher. It worked before. It became one of the most widely accepted frameworks in all of crypto. But this cycle didn't play out the way many expected. After the 2024 having, investors anticipated another euphoric move. Historically, the year after a having has been Bitcoin's strongest period. It was supposed to be the phase where prices accelerate, retail investors flood back into the market, and Bitcoin enters the kind of parabolic rally that has defined previous cycles. Instead, while Bitcoin still achieved impressive gains and eventually reached roughly $126,000, the move fell well short of the extreme targets many analysts had been predicting. Rather than experiencing another explosive run toward the numbers that dominated social media forecasts, Bitcoin spent much of the cycle battling volatility, competing for investor attention, and repeatedly struggling to maintain momentum. So, what changed?

[00:02:06]According to macro analyst Lyn Alden, investors may have been looking at the wrong indicators altogether. While the market remained obsessed with halvings, cycle charts, and historical patterns, a much larger force was quietly shaping Bitcoin's performance behind the scenes.

[00:02:23]The real story may not be about new supply entering the market. It may be about old supply leaving it. In other words, the biggest battle in Bitcoin right now may not be between bulls and bears. It may be between institutions buying and OGs selling. And according to Alden, that dynamic has become far more important than the halving cycle itself.

[00:02:44]But before we get into her analysis, make sure you hit the like button, subscribe to the channel, and let us know in the comments, do you think the four-year cycle is dead or is Bitcoin simply evolving into something much bigger? Now, let's hear what Lyn Alden has to say. Retail traders buy crypto on exchanges. Serious investors think about structure. iTrustCapital's crypto IRA lets your gains grow without capital gains gutting your profits. Their premium custody holds assets off exchange with institutional-grade security. And their treasury accounts give businesses and trusts crypto exposure with proper reporting and compliance. Same assets, completely different level of protection. 24/7 trading, no monthly fees, real US customer support, $100 bonus when you fund through the link below. Price matters. How you hold it matters more.

[00:03:35]>> Well, the short answer is, I mean, Bitcoin has this volatile track record, has higher highs and higher lows along the way, but it has these really big washouts. Um historically, it's pretty correlated with liquidity. Um at least 83% of the time, it's correlated with kind of overall kind of macro liquidity.

[00:03:51]About 17% of the time, it's not. Right now it's kind of in a in a period where it's not. Um in addition, I mean for a long time Bitcoin was the fastest horse, really, uh that that you could invest in. It was kind of the best performer.

[00:04:03]Uh and the rise of AI companies has challenged that because there are other places to put capital uh that can give you a 10x return or that have given investors a 10x return.

[00:04:14]Uh and so people say, "Well, why why would I hold Bitcoin when I can, you know, hold a chip stock or something like that?" Uh and of course the the advantage of Bitcoin is that uh it it gives you what a stock does not, which is that you can self-custody it uh like gold. Uh and uh you know, with advantages and disadvantages of first gold. I mean, gold's obviously got the longer-term track record. Uh the challenge of course is that it's uh not as mobile uh without, you know, relying on custody.

[00:04:40]Uh you know, I use the example that I I live part of the year in the US, I live part of the year in Egypt. Uh if I have self-custodial gold, I mean, there's going to be a time where I I travel and it's just it's out of my personal possession at that point.

[00:04:52]Uh whereas you can set up Bitcoin in a multi-signature way so that if you travel the world, you still have ways to to access uh self-custodial uh value that you can you can send around.

[00:05:03]Um and so there is a use case there.

[00:05:06]Uh and but I think from a price standpoint, from a pure investor standpoint of just buying it and holding it and not really using it, um you know, when people are can buy uh you know, uh Bitcoin treasury companies, they can buy Bitcoin ETFs, they can buy Bitcoin on exchange. Um there's they're comparing that price action to AI uh and and I think AI the rise of AI is kind of sucking a lot of the attention out of it. Uh now eventually when that stops rising, like we talked before, you know, when that kind of just say trends sideways for a period of time, uh and Bitcoin is washed out, I I think it can re-attract some of that capital.

[00:05:41]The other big factor is that uh you know, I've been bearish on the broad crypto space for for many years. I've been bullish on Bitcoin and stable coins, but but bearish on virtually every other project in the space. And a lot of that is really shaking out now.

[00:05:57]There's you know, right now just kind of the overall use case of broad crypto is very stagnant.

[00:06:04]I think a lot of investors are kind of realizing there's no there there.

[00:06:08]And a lot of that capital is intertwined. So as capital gets out of that broad crypto space, it naturally in near term hurts Bitcoin as well.

[00:06:18]But I think when when the dust kind of shakes out, Bitcoin and stable coins, you know, there's actually there there.

[00:06:25]And it's natural for kind of some of the air to come out of that broader crypto space. And it's healthy in the long run even though it can be kind of painful in the in the near term. I don't think the four-year cycle it is really functionally relevant anymore. It still I think has some kind of mental relevance in that people if people expect something they can kind of be a self-fulfilling prophecy.

[00:06:49]for the past cycle or two it's not really mattered. So earlier on the four-year cycle was really relevant because you had less coins in the market, you had more coins coming out with each block. And so a having, you know, that's what happens every four years roughly, a having. So there's just you know, half as many coins being introduced into the market per block.

[00:07:10]That really matters. You know, if you have a monetary network with say a 12% inflation supply inflation rate and it gets cut to 6%, that's a really big deal.

[00:07:19]But after multiple halvings, Bitcoin now has a supply like annual percentage supply growth of less than 1%.

[00:07:28]And the vast majority of kind of you know, marginal buying and selling of coins, prices are mostly set by how much longer-term holders are selling and at what prices versus how much new demand is coming in. That factor is 10 times bigger than, you know, how many coins are hitting the market with every block just because that number is so small now. So, when you when you have a say a 0.8% annual supply growth and you you know, you eventually have a having you cut that down to 0.4%.

[00:08:00]You know, that's that's less relevant than you know, is is 5% of you know, long-term held coins coming to market because you know, the the owners are concentrated and they want to kind of cash out. That's a much bigger factor than the having. So, I don't really view the four-year cycle as relevant. I just think liquidity is still relevant. I I think you know, the performance of precious metals and AI are relevant because obviously precious metals compete with Bitcoin on kind of the hard money front.

[00:08:29]So, if if those are rising at all, it challenges Bitcoin in terms of competition.

[00:08:34]But then also at you know, tech stocks kind of challenge Bitcoin cuz Bitcoin is is tech to some degree.

[00:08:39]So, when you have kind of that that fastest horse being AI, that also challenges Bitcoin.

[00:08:45]But you know, at the end of the day, it's it's you know, I I think the four-year cycle's less relevant and it's really just about the the usefulness of the network and the network effects that that the that the system still has.

[00:08:56]>> For years, investors assumed havings were the dominant force driving price appreciation. But Bitcoin's annual issuance has now fallen below 1%.

[00:09:06]Compared to previous cycles, the amount of new Bitcoin entering the market every day is relatively insignificant. What matters far more is whether long-term holders choose to sell and how much new capital is available to absorb that supply. When early adopters who accumulated massive positions years ago decide to take profits, they can introduce far more Bitcoin to the market than miners produce over extended periods of time. That's why Bitcoin can experience significant price pressure even during periods when issuance is at historic lows. At the same time, Bitcoin is facing competition it never had to deal with during earlier cycles. AI companies have become the new destination for speculative capital, drawing attention away from digital assets. Meanwhile, the broader crypto market continues to work through years of excesses, failed narratives, and projects struggling to demonstrate real-world value. Yet, Alden believes that this cleansing process may ultimately strengthen Bitcoin as capital exits weaker projects and concentrates around assets with proven utility.

[00:10:11]Bitcoin and stablecoins stand to emerge as some of the strongest survivors. But, Bitcoin's long-term future isn't just about price. It's also about what separates it from every other digital asset. And that brings us to one of the most important discussions in the entire interview.

[00:10:27]>> One is that a lot of times you'll see headlines like the Treasury seizes crypto, and people are like, "Look, they seized Bitcoin." It's like, "Well, no, they seized crypto." Uh so, a lot of times, I mean, that that that's kind of the risk of stablecoins.

[00:10:38]Uh is that especially stablecoins can just be, you know, you can they're they're a centralized issuer. So, you can just go to a centralized issuer and say, "Hey, freeze these tokens. We have identified that, you know, these are held by Iran or North Korea or whatever." And they can be frozen. Uh Bitcoin, while it, you know, around the margins it can be taken. I mean, if you if you find a way to get someone's private keys, if someone stores their private keys online, uh or you're you're able to enter their place and and take them. Uh you can seize Bitcoin. But, much like seizing a nation's gold or an individual's, you know, gold, it it it it does you know, there's there's a cost of doing that. Uh either either war in terms of a country, or uh arrest or intrusion as far as an individual. You know, without the private keys, you can't get someone's Bitcoin. Uh and some of the headlines I think confuse that for for some people that aren't kind of just well versed on how the cryptography works and how the the works. Um and there is a difference between how Bitcoin, you know, potentially can be seized versus how stable coins and certain other cryptos can be seized.

[00:11:40]There you know, there was some evidence that that Iran did turn to, you know, Bitcoin payments.

[00:11:46]Uh, you know, the question is what, you know, once they get the payments, what can they do with the Bitcoin? They can't just go on a Coinbase and say, "Hey, we're Iran.

[00:11:55]We want to go ahead and and sell our Bitcoin for, you know, dollars." Uh, that that's where that that off-ramp runs into issues. Now, Bitcoin is a global market and it's not just like, you know, it's not like a stock where it might trade primarily on one exchange.

[00:12:11]Bitcoin is this decentralized thing that can trade on multiple exchanges. There are gradual ways that Iran can offload, you know, their their Bitcoin for other types of value, but there are frictions with it.

[00:12:24]Generally speaking, the bigger the network gets and the more trading hubs there are for it, the easier it gets to offload it, right? So, the less kind of dollar-centric it becomes, it'd be easier for regimes like that to to offload it.

[00:12:40]But at the current time, I mean, I think that they have to be mindful of size.

[00:12:43]They can offload some, but they can't just, you know, get any amount of Bitcoin that they can and then just turn around and and get dollars or or, you know, yuan or gold for it easily.

[00:12:55]>> How far do you think that the strategy that the US government is pursuing since a few years now of saying no to CBDC but yes to stablecoin and and kind of using that as as a well, what I I call this a Trojan horse like to CBDC in some some form um, to export the dollar on a global basis and to create the infrastructure around this in order to also on the other side still create more demand for US Treasuries um, through like the creation of the synthetic dollar.

[00:13:29]Um, Did you like have some thoughts about this or like how how do you see this play out in in general?

[00:13:36]>> Yeah, I'm I'm bullish on stable coins.

[00:13:38]I've, you know, I've been bullish since, uh, several years ago the market cap was like 30 billion and now it's, you know, 300 billion uh, round numbers.

[00:13:46]Uh, and I I you know, I think eventually that they'll get into the, you know, the over a trillion. Uh, maybe maybe eventually to the multiple trillions.

[00:13:52]Um, so I think that there's a lot of demand there. The ironic thing is that the US doesn't really have to do much.

[00:13:57]They just have to not stop it. Uh, so the US could, if they wanted to, kill most dollar stable coins by saying, "Hey, if you if you issue a stable coin you're sanctioned. We don't want stable coins." So they could do that. But simply by not doing that, uh, there's a growth of, uh, stable coin demand that is is pretty organic. Uh, you know, if you if you kind of look at the the world, uh, I mean Africa has something like 40 currencies.

[00:14:21]Uh, Latin America has something like 30 currencies. There's There's plenty of currencies in in in Southeast Asia. All of these are frictions. All of these are border frictions. And stable coins, uh, are a very efficient way to to transmit value and to hold short-term value assuming you're not a sanctioned entity.

[00:14:39]Assuming you're not in Iran or North Korea where like, you know, the US, uh, and and the stable coin issuers can can shut you off from it. If you're just someone in Argentina or someone in Nigeria or someone in, you know, Malaysia, um, uh, they're a very effective tool to access a less inflationary currency than generally their local currency uh, and to pretty seamlessly store and transmit near-term value. It does get debased over time. Uh, you're basically holding dollars without yield. Uh, so you're holding something that, you know, the supply of it is growing by 7% a year and you're not you're not getting paid.

[00:15:14]The the stable coin issuer is getting paid. We got to keep numbers in mind. So if we go from let's say 300 billion in cap to 1.3 trillion. So let's say we added trillion in in market cap. That'll take time. And that's 6 months of US deficits. That's 6 months of of Treasury issuance. So, the the sheer numbers of how many Treasuries are out there, how many Treasuries are going to continue coming to market versus, you know, stablecoin demand, uh it's it's a relevant factor, uh but it's not as though it's a magic fix for the fiscal dominance that the US finds itself in.

[00:15:47]Uh and the the major cost is that people that that choose to hold stablecoins for more than just working capital are getting debased. I mean, again, they're holding something that that grows in supply by, you know, dollars grow by 7% a year on average, and they're not getting paid a yield in the in the way that they if they held Treasuries directly.

[00:16:04]Um and of course, they're not holding something that's that's, you know, kind of dilution-resistant like gold or or Bitcoin or you know, high-quality equities or real estate.

[00:16:13]>> One of the most fascinating implications of Alden's thesis is what it tells us about Bitcoin's future. If this cycle has been defined by OG holders distributing coins into unprecedented institutional demand, then eventually that process reaches a natural endpoint.

[00:16:29]Every Bitcoin sold by an early adopter is ultimately being transferred into stronger hands that have different incentives, different time horizons, and significantly larger pools of capital.

[00:16:41]ETF providers, corporate treasuries, sovereign entities, pension funds, and long-term institutional investors are not necessarily trading Bitcoin the same way early retail adopters did. They're accumulating strategic positions, and that may explain why this cycle has felt so unusual. Instead of a simple supply shock driven by the halving, the market has been processing years of accumulated profits held by some of Bitcoin's oldest investors. Numerous reports throughout the cycle have highlighted significant movements from dormant wallets and early whale addresses. Every time Bitcoin pushed higher, another wave of long-term holders appeared willing to sell into strength. While many investors interpreted that as weakness, Alden's framework suggests it may actually be part of Bitcoin's maturation process.

[00:17:29]The market has essentially been conducting a massive ownership transfer.

[00:17:33]The good news for long-term bulls is that this process cannot continue forever. Eventually, the pool of OG sellers shrinks. Coins that have been dormant for years become redistributed.

[00:17:44]Institutions continue absorbing supply.

[00:17:47]New treasury companies continue accumulating Bitcoin. Sovereign interest continues growing. And once the market no longer has to digest such large waves of legacy selling pressure, Bitcoin supply dynamics could begin looking very different. That's why the most important takeaway from this interview isn't that the four-year cycle is dead.

[00:18:07]It's that Bitcoin may be transitioning into a new phase where liquidity, adoption, institutional demand, and ownership distribution matter far more than the calendar. The next great Bitcoin bull market may not be driven by a halving. It may be driven by the simple reality that the sellers who have been suppressing upside for years have finally run out of coins to sell.

[00:18:29]And if that happens, the explosive gains that Bitcoin investors became accustomed to in previous cycles could return not just for Bitcoin itself, but potentially for the broader crypto market that tends to follow in its wake. But what do you think? Has OG selling been the hidden force behind Bitcoin's underwhelming cycle, or do you still believe the traditional four-year cycle remains intact? Let us know in the comments below. If you enjoyed this video, make sure to hit the like button, subscribe to the channel, and turn on notifications so you never miss our future market analysis. Thanks for watching, and we'll see you in the next video.

[00:19:25]>> Mhm.