⏳ Proof that the bull run has started!?

July 20, 2022

GM 👨‍👩‍👧‍👦

Seedphrase Daily👋 The crypto friends that will cover your tab if you sold the bottom.

Today’s estimated research time is 7 hours and 16 minutes condensed into a read time of 6 minutes. Stay tuned to where we talk about:

  • ⏳How long will the Bear Market last or has the bull run started? 

  • ⏮A recap of the WHOLE market

  • 👨‍💻Dubai is offering 40,000 Metaverse Jobs.

  • 🏗Binance will be a reason for mass adoption. 

  • 🌱NewSeeds

⏳How long will the Bear Market last?

The bear market feels like the last 5 minutes of class, your foot is going up and down while you keep glancing at the clock, but it seems like time is moving slower. 

Lucky for us, Grayscale Investments released a 22-page lite-paper explaining why they think it will only last another 250~ days.

We read through the whole thing, so you don't have to.

Here's the meat. 

🔎Identifying crypto cycles 

if previous market cycles are to repeat themselves, Grayscale Investments says that the bear market could last another 250 days

They believe that cryptocurrency markets mimic their conventional counterparts with cyclical movements.

Bitcoin (BTC) market cycles conventionally last for approximately 1,275 days. The firm defines a cycle when the realized price of BTC is below the current market price.

Realized Price = Realized Market Cap / Current Supply 

The sum of all assets determines realized price at their purchase price divided by the asset's market capitalization. 

This gives a measure of how many positions are profitable.

Wednesday, we saw the realized price of BTC cross below market price, which Grayscale identifies as the start of the current bear market.

🖼The bigger picture

In the current 2020 cycle, we are 1,198 days in as of July 12, 2022, which means another four months are left in this cycle until the Realized Price crosses back above the Market Price. 

Bitcoin is 214 days off the all-time high, which means we may see another 5-6 months of downward or sideways price movement.

 Historically, market bottoms also appear to come one month sooner each time. 

Each of the 2012 and 2016 cycles took under three years to regain all-time high (ATH) – 1,082 and 1,059 days, respectively. It took another year to push a new all-time high again after that.

In contrast to the previous two cycles, the 2020 cycle appears to have had a longer run in the ATH range with two prolonged peaks compared to the sharp rise and fall in prior cycles.

⏮A quick recap of the WHOLE market

2012 - 2015: The dark era 🥷

During this time, the crypto market consisted almost exclusively of Bitcoin.

CoinMarketCap didn't even exist until a year later.

Outside of trading, Bitcoin's primary purpose at the time was to purchase RPGs, computer viruses, Crack, and things along those lines on Tor websites like SilkRoad. 

The major theme of this cycle was the production of new crypto exchanges and wallets.

At the same time, people were trying to capitalize on trading the price action.

There was relatively no security or process to manage digital assets, resulting in repeated hacks totaling over 1M Bitcoin being stolen. 

Fast forward a little bit, after some minor setbacks like the closure of the Silk Road, China banning banks from handling Bitcoin, and the Mt. Gox hack of 850,000 Bitcoin, to name a few — the price of Bitcoin dropped ~80% in the year following the peak on December 16, 2017.

Hmmm. That sounds similar to what's happening now… 

The most important project created during the dark era was Ethereum, which launched in 2015, and would open the flood gates beyond just sending and receiving money. DeFi was born. 

2016 - 2019: Experimentation Era & The birth of Defi 🤰

During this period, sentiment recovered, and Ethereum brought more programmability to crypto. Initial Coin Offerings (ICOs) gained immense popularity as fundraising tools and scamming mechanisms.

From October 2017 through 2018, macro drivers, like Quantitative Tightening and trade disputes, caused emerging market and risk assets (crypto) to sell off. ICO unwinding also wiped a significant share of the market cap and value from the market.

The total crypto market cap fell from $700B to $100B but did not kill it completely. This was when Bitcoin dominance fell to all-time lows as capital moved to Altcoins and ICO tokens. 

Regardless of poor price action, this was when many protocols that currently hold the foundation of Web3 were born. Such as: 

2020 - Present: Leverage & Institutions Era🏦

The 2020 market cycle is a story of leverage. Between the rising popularity of Bitcoin futures, investors were enticed to begin leveraging up as a government spending response to the COVID-19 pandemic that boosted the economy. 

The current bear market we are experiencing was caused by Centralized DeFi (CeFI) hedge funds and companies over-exposing themselves to different positions. 

When the market turned bearish, they were liquidated out of many positions. Causing a massive sell-off that made the market tank. Prime examples would be Tera Luna or Celsius going to poo. 

What to do now? 👀

The biggest key takeaway you should have got from all of this: MARKETS REPEAT THEMSELVES. When entering the space, you sign up for volatility. BTC and other coins will fall +80% naturally. 

Now going back to the key takeaway. 

Cryptocurrency has been announced "dead" thousands of times by "experts" and mainstream media. However, crypto has always bounced back and grown to new greater heights. 

This part of the crypto cycle has happened several times since its existence. It would be more favourable to buy when the prices are down 80%, not up +1000%.

This technology is the future and is growing as fast, if not faster, than the internet. 

If you're reading this, you're already ahead of the curb 😉. We're early and have all the resources to take advantage of that blessing. 🤝

Speaking of 👇

👨‍💻Dubai is offering 40,000 new Virtual Metaverse Jobs.

It was announced by the Vice President, Prime Minister and Ruler of Dubai, H.H. Sheikh Hamdan In Mohammed Bin Rashid Al Maktoum (try saying that five times fast). He's looking to transform UAE into a global tech capital by becoming one of the top metaverse economies. 

The Dubai Metaverse strategy will include research and development to enhance the industries contributing to the metaverse's economic growth, such as tourism, education, retail, remote work, healthcare, and the legal sector.

Extended reality, augmented reality (AR), virtual reality (VR), mixed reality and digital twins (A virtual representation of an object or system) will all be integrated into the Strategy's framework.

They plan to help accelerate this creation of the metaverse by promoting the deployment of complete 5G networks to improve computing and data collection/storage that can be processed locally via smart devices and local networks instead of the cloud.

VR and AR have already created 6,700 jobs and contributed $500 million to UAE's economy. Globally, the metaverse's venture capital and private equity financing reached $13 billion in 2021.

The metaverse will include every industry in the world and will be integrated with everyday life/society. This frontier of new technology will help create a more global economy that is more accessible to most people on the planet. 🌏

🏗New Binance headquarters will be a step to mass adoption.

CZ has prided himself on being fully decentralized by having no main headquarters. Saying, "Is that an office where people sit? I worked from home for the last three and a half years. Our leadership team are not sitting in one office, we don't have a clear place where we can go by most people's normal definitions of a headquarters that we can call a headquarters."

Well, that will change soon once they announce the location of their single holding company that will be the main office! 

"When we started five years ago, there was very little regulatory framework. And in fact, most of the regulators we spoke to... they told us, 'We don't regulate this industry, you're off, we're not involved.' So back in those days, we were embracing the decentralized philosophy, and it worked really well for us."

As a result, to appease local regulators in countries, they set up offices in these countries to comply with the regulation.

"And we said, look, if we want this, what's the best way forward... as a centralized business, as a centralized exchange? The best way is to give them that structure. So we set up local offices, local entities, hired local compliance, legal, this whole structure."

  • In 2017, registered in the Cayman Islands.

  • In 2019, registered in Seychelles.

But as the space evolves, fewer countries/regulators are pushing back against Binance and are now trying to work with the company.

Our thoughts 🧠:

BULLISH! Establishing the main headquarters in a country will lead to much more enforced regulations, which would help adapt cryptocurrency to the masses. I guess it will be in Dubai because it's the best place to cater to crypto's growth, with its lack of regulation, no taxes, and plans for the future. 🚀

🌱NewSeeds

French Banking Giant BNP Paribas enters Crypto Custody Space. More countries are seeing the benefits. 🏔

Meme of the Day 

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See you tomorrow! ✌️

Disclaimer: None of this is financial advice. This newsletter is strictly educational and is not investment advice or solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research! 

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