Benjamin Cowen looks at why this crypto cycle feels different, even though Bitcoin is performing well. The missing piece? Retail investors. Using the ISM (Manufacturing PMI) as a guide, he explains why Main Street still isn’t participating in the same way as in past cycles.
Key Points
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Bitcoin peaks often align with ISM tops – The ISM, which signals economic expansion or contraction, has stayed below 50 (contraction) throughout this cycle, pointing to broader economic pain on Main Street.
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Retail investors are missing – In past cycles, everyday people were drawn into crypto during periods of economic optimism. Today, high inflation, AI fears, and tight monetary policy are keeping them sidelined.
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Loose monetary policy is key – Cowen suggests retail will only return if there’s a scare that forces the Fed to cut rates or if Jerome Powell is replaced. For now, rate cuts remain unlikely.
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This cycle resembles 2019 – Back then, the ISM also trended down, retail stayed out, and euphoria never showed up - until a big policy shift triggered a rally.
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It’s a blue-chip market – Bitcoin and other major assets have rallied, but smaller altcoins haven’t. That’s because institutions are leading this cycle, not retail.
Final Takeaway
This cycle is about discipline. Without retail hype, the focus shifts to fundamentals and sound investing. Cowen sees long-term upside, but until Main Street heals, the altcoin mania will have to wait.
