Bridger Pennington weighs whether crypto's 2025 losses trigger another four-year cycle or a new supercycle. Vanguard, Bank of America, and JPMorgan are moving into crypto while retail panics. Regulatory clarity, a dovish Fed, and quantitative easing could spark rapid recovery.
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2025 was a brutal year for cryptos, with many of them dropping over 50 or 60% for the year. Let's talk about, are we in another 4-year cycle or could we be entering the supercycle? Now, if you're new to crypto, welcome to the show. All right, here's some old wisdom from Charlie Munger, Warren Buffett's business partner. I love this. I've had my Berkshire stock decline by 50% 3 times. It doesn't bother me that much. That's just a natural consequence of an adult life. And from Warren Buffett himself, if you're not ready for stocks to drop 50%, you shouldn't be investing. So welcome to the show. Typically crypto kicks you in the teeth before you make any money. So interesting to me at the end of this cycle is I've never seen retail investors so worried and fearful on crypto at the same moment while institutions are so bullish on crypto. Couple data points in the last few weeks. We saw Vanguard reverse their decision on crypto, allow crypto ETFs on their platform. Bank of America said their advisors are allowed to recommend up to a 4% crypto allocation. We saw Jamie Dimon do a complete 180 from being a crypto hater to now a pro-crypto person tokenizing a private equity fund, launching the JPM Coin, and saying everything is going on-chain. Tokenization is real. It is here to stay. They— he said on their quote on CNBC that they did $16 trillion of transactions in one day. So you're seeing institutions very excited, retail very bearish. We have the Clarity Act coming out in a few weeks. Hopefully, it'll be passed. The CFTC and the SEC will have clarity on what they're doing. Between the two, we'll have Ethereum and Bitcoin will be commodities, and we'll have digital commodity licenses for institutions to trade these assets. For me, we have a distinct distinction here. Maybe we're going to have another 4 years of sadness, 3 years of sadness to another 4-year cycle, or— We're entering a supercycle. Now you dovetail all institutional excitement with a new Fed chair in May that's looking to be very dovish on the economy. We have the Fed already moving to quantitative easing, injecting liquidity into the market. We have a lot of things going on from the Trump administration on pro-business initiatives. Man, it makes me sit here and go, I think we could be entering a supercycle in crypto. This is a unique time. I've never seen this in my, you know, I've been in crypto about 7, 8 years. Dan's been in crypto, I think, what, 12, 13 years? We've never seen institutions this involved and retail this sad about crypto in the same moment. What a time to be alive. I think we could be back to all-time highs in a very short period of time. Now, crypto is volatile. People that joined 25, welcome to crypto. It'll usually kick you in the face before you make any money, but Man, I think we could see something pretty special here in the near future. Now, near is a subjective word. I don't know exactly when, I don't know exactly why or who, but, uh, we're keeping our chips in. It's a pretty fun time to be involved.
