Crypto Market Trends Resemble 2017, Suggests Extended Cycle

According to Cointelegraph, the current cryptocurrency market is exhibiting patterns reminiscent of 2017, a year when Bitcoin experienced a steady rise before a dramatic surge in December. Raoul Pal, CEO of the crypto research platform Real Vision, highlighted these similarities in a recent video. Pal anticipates a prolonged crypto cycle this time, citing his macroeconomic model, the business cycle score, which remains below 50, indicating a gradual climb. Bitcoin's performance in 2017 saw it start the year at approximately $1,044, reaching $2,187 by the end of May, and closing the year at $14,156, marking a significant 1,255% increase, as per CoinMarketCap data. Pal speculates that the weakening U.S. dollar suggests the current crypto cycle may extend into the second quarter of 2026. The U.S. Dollar Index (DXY) has declined by 8.99% since January 1, currently standing at 98.77, according to TradingView data. This inverse correlation between Bitcoin and the DXY makes Bitcoin more appealing as both a speculative investment and an alternative currency when the dollar weakens. Pal attributes the extended crypto cycle to macroeconomic data, noting that the cycle appears to have shifted due to unadjusted rates and a stagnant dollar. He suggests that current market conditions might resemble those of 2020 more than 2021, indicating that the market could be in an earlier growth phase than widely assumed. Pal emphasizes the importance of attracting larger players to sustain market expansion. During a recent visit to the Middle East, he observed a bullish outlook on crypto among Sovereign Wealth Funds. The region's focus, spanning from Saudi Arabia to Abu Dhabi, Dubai, Bahrain, and Qatar, is on artificial intelligence and blockchain technology. This includes not only using Bitcoin as a reserve asset but also integrating blockchain into government infrastructure.