An experienced crypto analyst predicts that Bitcoin (BTC) will not see the same level of gains as in previous market cycles.
During a recent strategy session, crypto trader Benjamin Cowen shared with his 842,000 YouTube followers that Bitcoin’s return on investment (ROI) is expected to decrease compared to previous cycles.
“In the third market cycle, Bitcoin’s ROI at this point was around 5.55x. Currently, in this cycle, Bitcoin’s ROI from the low is between 6.1-7x. In the last cycle at this stage, the ROI was 9.9x.
It’s interesting to see how the ROI is positioned between the last two cycles. However, it’s likely that at some point, the ROI will fall below that of the third cycle.”
Cowen believes that Bitcoin’s returns will plateau due to its larger market cap, leading to diminishing returns.
“Similar to the last cycle, there were discussions about diminishing returns and whether it would continue until the end. While some expected it to, as we approached the end of the cycle, it fell short of the previous cycle’s ROI.
I anticipate a similar scenario this time, where it may seem to track consistently but eventually, we will likely see diminishing returns. For example, two cycles ago, Bitcoin’s ROI from the bottom was a 100x increase. Achieving such gains in later cycles is challenging due to the increasing amount of capital required to impact the market.”
Bitcoin is currently priced at $101,100, reflecting a 1% decline in the last 24 hours.
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