Farewell to the "four-year cycle": The old order of Crypto is dead and a new order should be established

I really like Ray Dalio's "Changing World Order" model because it forces you to look beyond the local perspective and see the big picture. Rather than getting caught up in the day-to-day drama of cryptocurrency X, you examine long-term changes. This is how we should view cryptocurrencies. This isn't just about a rapid shift in narrative; it's about a complete overhaul of the entire industry order. Cryptocurrency is no longer the market it was in 2017 or 2021. Here's how I think the order is changing.

01 The Great Rotation

The launch of Bitcoin spot and ETFs marks a major turning point.

Just this month, the SEC approved common listing standards for commodity ETPs.

This means faster approvals and more assets will enter the market.

Grayscale has already applied for related products using this new regulation.

Bitcoin ETFs have set a record for the most successful launch in history. Ethereum ETFs got off to a slow start, but now hold billions of dollars in assets even in a weak market. Since April 8th, spot cryptocurrency ETFs have led all ETF categories with $34 billion in inflows, surpassing thematic investments, Treasuries, and even precious metals. Buyers include pension funds, investment advisors, and banks. Cryptocurrencies now appear in the same portfolio allocations as gold or the Nasdaq. Bitcoin ETFs hold $150 billion in assets under management, representing over 6% of the total supply. Ethereum ETFs hold 5.59% of the total supply. All this in just over a year. ETFs are now the primary buyers of Bitcoin and Ethereum. They are shifting the ownership base from retail investors to institutions. As you can see from my post below, whales are buying, while retail investors are selling. More importantly, old whales are selling to new whales. Ownership is rotating. Believers in the four-year cycle are selling. They expected the same scenario to repeat itself. But something different is happening. Retail traders who bought at the bottom are selling to ETFs and institutions. This shift resets the cost basis to a higher level. It also raises the bottom of future cycles because new holders won't sell at the first sign of profit. This is the Great Rotation Out of Cryptocurrency. Cryptocurrencies are moving from speculative retail investors to long-term investors. Universal listing standards usher in the next phase of this rotation. Similar rules for the stock market tripled ETF issuance in 2019. The same is expected in cryptocurrencies. Numerous new ETFs targeting SOL, HYPE, XRP, DOGE, and others are about to launch, providing retail investors with the exit liquidity they need. The big question remains: Can institutional buying offset retail selling?

If the macro environment remains stable, I believe those who are selling now in anticipation of a four-year cycle will buy back in at higher prices.

02 The End of the Broad Market Rally

In the past, cryptocurrencies would rally together. Bitcoin would move first, then ETH, and then all the others would follow. Smaller-cap coins would surge as liquidity flowed down the risk curve.

This time is different; not all coins are rallying together.

There are millions of coins now. New coins are launched daily on pump.fun, and "creators" are shifting attention from older tokens to their own MeMe coins. Supply is exploding, while retail attention remains constant. Liquidity is fragmented across too many assets because issuing new tokens is almost cost-free. Tokens with low circulating supply and high fully diluted valuations were once popular, paving the way for airdrops. Now retail investors have learned their lesson. They want tokens that return value, or at least have strong cultural appeal (the failure of $UNI to surge despite strong trading volume is a prime example). Ansem is right: we've reached peak pure speculation. The new metanarrative is revenue, because it's sustainable. Applications with product-market fit and fees will skyrocket. Everything else won't.

Two things stand out: the high fees users pay for speculation and the efficiency of blockchain rails compared to traditional finance. The former has peaked, while the latter still has room to grow.

Murad adds another good point that I think Ansem missed. The tokens that are still going viral are often new, strange, and misunderstood, but backed by communities with strong convictions. I'm one of those people who loves new, shiny things (like my iPhone Air). Cultural significance can make the difference between survival and failure. A clear mission, even if it seems delusional at first, can keep a community alive until adoption snowballs. I'd put Fat Penguin, Punk NFTs, and MeMe Coin in this category. However, not every shiny new thing succeeds. Runes, ERC404, and the like taught me how quickly novelty wears off. Narratives can emerge and then vanish before reaching critical mass. I think these insights together explain the new order. Revenue filters out weak projects. Culture supports misunderstood projects.

Both are important, but in different ways. The biggest winners will be the few tokens that can combine the two.

 03  The Stablecoin Order Gives Credibility to Crypto

Initially, traders held USDT or USDC to buy BTC and altcoins. New inflows were bullish because they converted into spot buying. Back then, 80% to 100% of stablecoin inflows ultimately went into buying cryptocurrencies.

That has changed now. Stablecoins are entering the market for lending, payments, yield farming, treasuries, and airdrop mining. Some of this capital never touches spot BTC or ETH buy volume. But it still boosts the entire system. There's more trading on L1 and L2. DEXs have more liquidity. Lending markets like Fluid and Aave generate more revenue. The ecosystem's funding market is deeper. A new development is the payments-first L1. Stripe and Paradigm's Tempo are built for high-throughput stablecoin payments, with EVM tooling and native stablecoin AMMs. Plasma is Tether's backed Layer 1, designed specifically for USDT and enabling neobanking and card services in emerging markets. These chains push stablecoins into the real economy, not just for transactions. This brings us back to the "blockchain for payments" meta-narrative. What this might mean (honestly, I'm still unsure). Tempo: Stripe's distribution capabilities are enormous. This helps with broader cryptocurrency adoption, but may bypass spot demand for BTC or ETH. Tempo could end up like PayPal: huge traffic but little value accumulation on Ethereum or other chains. The open questions are whether Tempo will have a token (I think it will) and how much fee revenue will flow back into the cryptocurrency. Plasma: Tether already dominates issuance. By connecting chains, issuers, and applications, Plasma could pull a large portion of payments in emerging markets into a closed ecosystem. It's like the closed Apple ecosystem versus the open internet driven by Ethereum and Solana. This sets up a competition with Solana, Tron, and EVM L2 to become the default USDT chain. I think Tron is most vulnerable here, and Ethereum was never built for payments. But launching on Plasma by Aave and others is a major risk for ETH...

Base: ETH L2's savior. As Coinbase and Base facilitate payments through the Base app and generate yield through USDC, they will continue to generate fees for Ethereum and DeFi protocols. The ecosystem remains fragmented but competitive, which makes liquidity more widely distributed.

Regulation is aligning with this shift.

The GENIUS Act is now pushing other countries to catch up in the global stablecoin game.

The CFTC just allowed the use of stablecoins as tokenized collateral in derivatives. This increases non-spot demand from the capital markets, in addition to payment demand. Overall, stablecoins and new stable L1s have given cryptocurrencies credibility. What was once simply a gambling venue now holds geopolitical significance. Speculation remains paramount, but stablecoins are clearly the second-largest use case in crypto. The winners will be the chains and applications that can capture stablecoin traffic and convert it into sticky users and cash flow. The big unknown is whether new L1s like Tempo and Plasma will become leaders in locking value within their ecosystems, or whether Ethereum, Solana, L2s, and Tron will be able to fight back. 04 DATs: New Leverage and IPOs for Non-ETF Tokens Digital Asset Treasuries worry me. With every bull cycle, we find new ways to leverage tokens. This drives prices to levels unattainable with spot buying alone, but liquidations are always brutal. When FTX collapsed, forced selling from CeFi leveraged assets devastated the market. This cycle's leverage risk could come from DATs. If they issue equity at a premium, raise debt, and pour funds into tokens, they could amplify the upside. But the same structure can also amplify declines when sentiment shifts. Forced redemptions or the drying up of share buybacks could trigger heavy selling pressure. So, while DATs expand access and bring in institutional capital, they also add a new layer of systemic risk. Here's an example of what happens when mNAV > 1. Simply put, they give shareholders ETH, and shareholders are likely to sell. Yet, despite the "airdrop," BTCS still trades at 0.74 mNAV. Not great. On the other hand, DATs offer a new bridge between the token economy and the stock market. As Ethena founder G wrote: This is the context for the importance of DATs. Retail capital may have peaked, but tokens with real businesses, real revenue, and real users can enter the larger stock market. Compared to global stocks, the entire altcoin market is just a rounding error. DATs open the door for new capital inflows. Moreover, because few altcoins have the expertise to launch DATs, those that do have refocused attention from millions of tokens to a handful of Schelling point assets. His other point, that NAV premium arbitrage is unimportant… is bullish. Aside from Saylor, who can use leverage in his capital structure, most DATs won't maintain a sustained premium relative to NAV. The real value isn't in the premium play, but in access. Even a stable one-to-one NAV and consistent inflows is better than no access at all. ENA and even SOL's DATs are reviled for being "cash-out vehicles" for VC tokens. ENA is particularly vulnerable due to its significant VC holdings. However, due to the capital mismatch problem where private VC funds far outstrip secondary liquidity demand, exits to DATs are bullish, as VCs can then deploy capital to fund other crypto assets. This is important, as VCs have been battered during this cycle, unable to exit their investments. If they can sell and gain new liquidity, they can ultimately fund new innovation in crypto and propel the industry forward. Overall, DATs are bullish for crypto, especially for tokens that don't have access to ETFs. They allow projects with real users and revenue, like Aave, Fluid, and Hype, to shift exposure to the stock market.

Of course, many DATs will fail and have a spillover effect on the market. But they also brought IPOs to ICOs.

 05 The RWA revolution means we can have a financial life on the chain

The total on-chain RWA market has just exceeded US$30 billion, up nearly 9% in just one month. The chart only goes up and never down. Treasuries, credit, commodities, and private equity are now tokenized. Escape velocity is rapidly curving upward. RWAs bring the world economy onto the blockchain. Some of the major shifts are: Before, you had to sell your crypto for fiat to buy stocks or bonds. Now you can stay on-chain, hold BTC or stablecoins, transfer into treasuries or stocks, and maintain self-custody. DeFi has broken free from the "circular Ponzi schemes" that were once the growth engine for many protocols. It has brought new revenue streams to DeFi and L1/L2 infrastructure. A major shift is collateral. Aave's Horizon lets you deposit and borrow tokenized assets like the S&P 500. But the TVL is still small, at only $114 million, meaning it's still relatively early days for RWAs. (P.S. Centrifuge is working to bring official SPX500 RWAs to chain. If that happens, CFG could perform well. I'm holding a position.) Traditional finance makes these things nearly impossible for retail investors. RWAs ultimately make DeFi a true capital market. They set benchmark interest rates using government bonds and credit. They expand global reach, allowing anyone to hold U.S. Treasuries without needing a U.S. bank (which is becoming a global battleground). BlackRock launched BUIDL, and Franklin launched BENJI. These aren't fringe projects. They're bridges for trillions of dollars into crypto. Overall, RWAs are the most important structural revolution right now. They make DeFi relevant to the real economy and lay the groundwork for a world that can remain entirely on-chain. 06 Four-Year Cycle The most important question for crypto natives is whether the four-year cycle is over. I hear people around me already selling off, expecting it to repeat. However, I believe that with the changing crypto order, the four-year cycle will not repeat itself. This time is different. I’m betting with my position because: ETFs transform BTC and ETH into institutionally configurable assets. Stablecoins have become geopolitical tools and are now entering the payment and capital markets. DATs create a path to equity liquidity for tokens without ETFs, allowing VCs to exit while funding new businesses. RWAs bring the world economy onto the blockchain and create a benchmark interest rate for DeFi. This isn't the casino of 2017, nor the mania of 2021. This is a new era of structure and adoption, where cryptocurrency merges with traditional finance while still driven by culture, speculation, and conviction. The next winners won't come from buying everything. Many tokens may still experience a repeat of their four-year sell-off. You need to be picky. The true winners will be those projects that adapt to macro and institutional changes while maintaining cultural appeal with retail investors. This is the new order.