GM. This is Milk Road, the crypto newsletter that helps you stay optimistic for the future when the market keeps testing your emotional resilience.
Here’s what we’ve got for you today:
- ✍️ This sucks. Where to from here?
- 🎙️ The Milk Road Show: Why Institutions Need Coinbase to Move Onchain w/ Brian Foster.
- 🍪 Bitcoin has erased all gains since Trump’s election.
Milk Road and Alumni Ventures are teaming up this week only to give readers early access to high-potential startup opportunities. Get access to VC deals for FREE now.
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FIRST: THIS SUCKS. SECOND: WHERE TO FROM HERE? 🗺️
I’ve been told many times in my life that I take after my father, in that I’m painfully optimistic.
Which sometimes leads to me failing to read the room and ‘match the mood’.
I’m not going to do that today - at least, not entirely.
I’ll admit it: this sucks.
BTC just dipped as low as $65k, while the total crypto market has lost almost 50% of its value since October.
And at this point it feels like no amount of good news or positive momentum is capable of fixing it in the short term.
So let’s all take a minute to scream into the nearest pillow, and maybe even punch a hole in some nearby drywall.
Done? Good. Now put some ice on those knuckles and get ready to focus.
I have a ‘painfully optimistic’ reputation to uphold, and I’m not about to let it slip.
See, after checking CoinGecko this morning, in a process of self-soothing, I actually found something that shifted my current frame.
It might not alter your current mood, but I’m hoping it will brighten your future outlook.
So here goes…
Right now, there are essentially two competing theories on what the crypto market is doing:
- We’re in the same old 4yr boom/bust cycle and we just hit ‘the bust zone’ (oops, made it sexual).
- We’re in a new, 5yr cycle and this is the last shakeout before a Q4 boom.
Now, I’m here to tell you that, if you’re in this for the long haul: neither thesis matters right now.
Check this out…
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FIRST: THIS SUCKS. SECOND: WHERE TO FROM HERE? (P2) 🗺️
Here are the average bear market drawdowns/timelines from all-time highs to bottoms, for Bitcoin, Ethereum, and Solana:
- BTC drops an average of 85.62% over 382 days.
- ETH drops an average of 86.01% over 506 days.
- SOL drops an average of 96% over 418 days.
Note: Bitcoin has seen 4 bear markets, Ethereum has seen 2, and Solana has seen 1.
(So the data is not created equally - and Solana’s first/last drawdown was likely extended by its association with FTX.)
Long story longer: don’t take these timelines as gospel, but a rough (potential) guide.
Now, if history rhymes, as it often does - the current market losses from recent all-time highs and the days left till we hit bottom are as follows:
1. BTC: -46%, with 260 days till bottom (if history rhymes)
2. ETH: -60%, 341 days left till bottom (if history rhymes)
3. SOL: -70%, 35 days left till bottom (if history rhymes) - take this one with a big grain of salt
Now, here’s how both cycle theories essentially lead to the same opportunity:
Assuming the 4yr cycle is dead and we're entering a 5yr cycle…
That thesis points to a massive run-up hitting somewhere in Q4 2026.
In such a case, the current market is offering up an amazing buying opportunity.
Assuming the 4 year cycle is alive and well…
The market is likely set to continue down, with history telling us that these assets will hit bottom anywhere in the next 1-11 months.
(Oct for BTC, Jan for ETH, Mar for SOL.)
Either way, you're looking at heavily discounted prices on assets that have historically recovered and made new highs.
Remember when you mentally lashed yourself for not buying Bitcoin at $15k, Ethereum at $900, and Solana at $9?
If this downtrend continues (4yr cycle theory): you’re about to get a similar opportunity.
If it doesn’t, and instead reverses (5yr cycle theory): these assets are set to recover and potentially break all-time highs later in the year.
(Yuh. As I said, painfully optimistic.)
Regardless of whether you want to shake my hand, or punch me in the face right now:
I hope this helped you reframe your future outlook.
I know it did for me!
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Bull case for rate cuts: The labor market weakened significantly this week, giving further room to future potential cuts.
Ooof! Bitcoin has now erased all of its gains since President Trump was elected back in 2024.
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