Ah, 2025. Finally! The golden year of the golden era for crypto. The best year of the four-year cycle. The year of the snake!

Trump will lead a rebirth of crypto in the US and unleash a wave of new money into the crypto market.

Remember that when the next bear market comes. It could be the first bear market with healthy regulations in the US and a clear path for legacy entities who want to participate in this space.

For us, it'll be a chance to buy crypto at a massive discount without fear of chokepoints or arbitrary regulators.

We will feel the full effects of this shift in 2027, assuming it happens.

Today, anticipation of this outcome may carry us higher as the president and Congress implement their agenda.

To navigate 2025, you'll need to sort out the hype from the substance. I'll explain more at the end of this post. Let's first look at the crypto market and set a preface for the year.

2017 all over again?

You'll hear people say, “Look at 2017! That’s what we have to look forward to. $288,000 by October. Maybe even $500,000!”

Yes, please look at 2017. Look at the contours of the lines. The perfect retests of the 21-week moving average, also known as the bull market support band. A beautiful parabolic uptrend.

Now, look at every other year. Totally different.

They want you to believe 2025 will look like 2017.

This seems unfair. 2017 is the outlier. It's the exception to the rule.

When you buy into that rationale, you ignore the other 14 years of price action and three of the four market cycles.

No, Mark. Nobody says it has to be just like that. We're just saying it's going to be really good!

I know.

In one of last month’s posts, I joked about an alien invasion of New Jersey.

Could you imagine how high Bitcoin’s price could go if the aliens bought some? There aren’t enough Bitcoins for every human millionaire to own one—imagine the FOMO those alien millionaires will feel when they find out!

So many people have already put money into the market, expecting a great 2025. They may have extra to contribute as their good fortune allows, but not as much as before.

While they were putting new money into the market, a lot of OGs and long-time HODLers sold a bunch. We saw this as it happened in my market updates.

Those sellers may put some of their proceeds back into the market, but they've already banked some of it and sent some to their government (taxes). What they bring back will be less than what they took out.

A time to gather stones?

If you’re hoping for a huge 2025, you’re banking on new money from outside sources. Where will that money come from?

Aliens, of course!

What if they don't come?

Peter at the Party is asking you whether it's a good time to buy crypto, but he only has a few hundred dollars to spare.

Tony on the TV hypes up Bitcoin every chance he gets, but he's already put his money into the market.

Billy the Neighbor switched from memecoins to AI agent tokens, but he’ll go back to trading options as soon as the market “breaks below support.”

Samantha Down the Street started putting $10 each week into her Coinbase account, but even if you had a million of her, that's not enough to move the market anymore.

Aunt Sally and Uncle Morton already have their 1-3% allocation. They're saying nice things about crypto to the Pickleball crew, but if Bitcoin's price moves up high enough, fast enough relative to the rest of their portfolio, they will have to sell some to get back to their target allocation. They're not going to be buying into the pumps.

Colin Talks Crypto summarizes some challenges in this beautiful three-minute video.

The Plan

What's the solution?

My plan.

Three lines on a chart tell me when to buy. Two metrics tell me when to sell.

When market circumstances dictate, I buy or sell outside my plan.

If you follow my plan, you have a strong allocation to the market. You're up 60% at worst, up 1,800% at best, and most likely up 200% with cash to spare.

Where you fall depends on when you started and whether you bought last summer’s drop with new money or money you recycled from selling Bitcoin in March and altcoins at the beginning of April last year.

This is what you’d have done with Bitcoin since 2023, after buying for most of 2022:

Along the way, you got market updates to help you make the best decisions and navigate the ups and downs.

The plan doesn't apply to altcoins, but generally, when Bitcoin's price is in the buying zone, you can buy altcoins, too.

Care to gamble?

2025 is not a bet on my plan or any particular fractal, cycle theory, or data model. It's a bet on the US economy remaining strong enough to bring new money into the market.

Why the US economy and not China or others?

The US is the largest economy in the world, Wall Street controls roughly a quarter of the world's wealth, and US entities control a higher ratio of crypto capital than they have in years.

The Fed says it won’t cut rates as much as people expected a few months ago. That seems like a disappointment but it's not necessarily bad. There's an outside chance we’ll do better without further rate cuts.

The US’s best economies, 1980s and 1990s, had higher inflation and unemployment than today’s. Most years, interest rates were higher, too.

Lower rates may encourage some to sell bonds for other assets, but that doesn’t necessarily mean more total economic or financial stimulus.

The US government carries $36 trillion in debt.

Its private sector carries roughly $5 trillion in consumer debt, $14 trillion in business debt, and $260 billion drawn against home equity lines of credit, for a total of almost $20 trillion.

Every 1-point drop in interest rates takes $360 billion from future bondholders and saves $200 billion for future borrowers. That’s a net reduction in cash.

• 1% of $36 trillion = $360 billion out

• 1% of $20 trillion = $200 billion in

(Actual numbers and economic impact depend on many variables, e.g., fixed/variable rate debt, timing of debt refinancing, how the Treasury manages duration, etc. Let’s assume “all else is equal,” which isn’t true but, but it’s useful for illustrating a concept. Directionally, the point holds even if the specific numbers are useless.)

We have reached the perverse state of affairs where rate hikes stimulate the economy! You've heard of trickle-down economics. What about upside-down economics?

Higher rates may boost markets—and possibly do it better than government stimulus.

Government stimulus always comes with strings attached.

Bondholders can do whatever they want with their interest payments. No conditions. No limits. No extra paperwork or permission from some government agency, just fresh dollars to put into the real economy, free and clear.

The US prints these dollars out of thin air, so they can do this for as long as taxpayers, politicians, and speculators allow.

And the other debt?

On the other side, so much private debt is now fixed at lower rates that cuts do not save money, offer a chance to refinance, or encourage them to borrow more.

On top of that, non-bank options like private placements, pay-as-you-go, and buy now pay later open up a source of credit that is only tangentially affected by interest rates.

Mark, you’re forgetting about mortgage debt! It’s huge!

Yes, over $20 trillion—most of it locked into 30-year loans with fixed rates too low to refinance at today’s levels.

Those who bought from 2023 to 2024 might have higher rates, but they represent a very small portion of the market. The total outstanding mortgage balance has risen only $1 trillion since 2022. If homeowners refinanced all that new debt, they’d free up about $10 billion in cash flow.

Peanuts. I didn’t include this in my calculations.

Do higher rates offset the near exhaustion of reverse repo liquidity and the ~$8 trillion in debt the US Treasury has to refinance in 2025?

We'll see.

Also, consider the impact of the California wildfires, which threaten to bankrupt the few insurers that remain in California and potentially spread contagion to banks and other entities downstream.

Biden said he would backstop all damages. Trump will likely do the same. That’s another $50 billion printed out of thin air and injected into the economy.

What about China, the world's largest trading partner? Its economy can't get out of the mud. A lot of countries depend on China for their growth. What happens to them if China can't provide that?

And tariffs, too! These will reduce US demand for foreign goods and increase prices for US customers and businesses. In other words, less money for people in the US to put into crypto.

On the flipside, foreign manufacturers will send goods and services to other markets, creating lower prices and more jobs for people outside of the US. Those people may put some of their new wealth into crypto. Brazil’s soybean farmers are still reaping the benefits of US/China tariffs.

Let's not think about war in the Horn of Africa or elsewhere. God forbid Tether collapses.

Geeze, the “macro” is complicated. No wonder it’s so hard to predict!

What about Trump?

Mark, Trump will cut the government and send hundreds of billions of dollars back to taxpayers! They’ll put some of it into crypto!

Yes, I have a lot of faith in Elon’s DOGE effort, too, though he may have set expectations too high.

It took Elon five years to make the first Tesla car and 10 years to make the company profitable. It took SpaceX 15 years to build a reusable rocket.

Yet he expects to do something much harder—reform government—in less than four years?

With Tesla and SpaceX, he had full control over what happened. He was the CEO.

With the government, he’s an advisor. 536 people will decide what the US government does with DOGE’s work. Every two years, up to 100 of those decision-makers may change. A panel of 9 justices can overturn their decisions at will.

On top of that, the political situation is dicey.

Trump won less than 50% of the popular vote and the Republican Party holds a razor-thin majority in the US House of Representatives. It has only 53 seats in the Senate, below the historical average of 55 seats that the majority party usually holds.

Tight margins. Not much room for error.

The Zeitgeist suggests the GOP should steamroll their way to getting everything that Trump wants. The reality suggests it’s not as easy as you’d think.

Anyway, can anybody cut enough fast enough to change the direction of government spending?

DOGE aims for $2.5 trillion in cuts, but the entire US discretionary budget—the portion Congress and the president control—is only $1.9 trillion. That's barely 5% of the national debt.

By law, they can't touch Social Security, Medicare, interest payments, and some veterans benefits, agricultural subsidies, and income security programs—but those things make up the vast majority of US government expenses.

For DOGE to accomplish its goal, politicians will have to cut everything they can touch and then find another $600 billion extra each year for a generation.

Better act fast!

Why not try anyway?

Does that mean DOGE will fail?

No.

We spend $800 billion on the military alone. Surely we can squeeze some efficiencies out of there.

We spend $300 billion on the people and equipment that run the US federal government. Surely we can find ways to trim.

We could save another $50 million by firing White House staff, security, and maintenance workers. Does the President need all those people? Surely he can move everything to Mar-a-Lago, can’t he?

That way, we can sell the property or lease the facilities to foreign countries for extra revenue. The White House sits on prime DC real estate! At today's land prices, we could raise $500 million from a sale, possibly more from leasing it out.

Also, Congress can vote to move mandatory programs into the discretionary bucket. Politically, that's a heavy lift, but you never know what can happen when you try.

Don’t they know?

You’ll find no political statement or agenda in anything that I said. I said everything I wanted to about politics in July and October.

• What Will Save Crypto?

• The US Presidential Election Matters For You, Not Your Crypto Portfolio

At the end of the day, it's not a political issue anyway. It's a human issue. Solving problems is hard! Like trying to dig your way out of a hole.

That may be why political insiders have started talking about the “swift kick:” an aggressive restructuring of fiscal, monetary, and regulatory policy that cuts quick and hard to lay the foundation for a new one.

I used to work in politics and still subscribe to political rags. I live near DC. My day job puts me on the edge of the political loop. I hear what the insiders are talking about.

You might hear inklings of it, too, like when Musk says we need to expect short-term pain.

The plan:

1. Pump the markets one last time. Cash out.

2. Implement the Trump agenda as quickly as possible. Mass deportations, tariffs on everything, tax cuts if possible. This will crash the US economy.

3. Use the ensuing recession to remake government and financial markets, including crypto laws.

4. Buy financial assets for cheap in the bear market. Get a full allocation before the inevitable turnaround.

5. Prosper once the US economy recovers.

If all goes to plan, the economy will recover in time for the next presidential election. Even better if the recovery comes before the 2026 Congressional election. They want an outcome like Reagan’s first term: crash, recession, prosperity.

Given the US’s present circumstances, the fundamentals may support this approach:

• Low household debt servicing costs

• Record-low household debt-to-GDP ratio

• Household net worth approaching a record $160 trillion with $9t in cash

• High corporate cash reserves

• Strong US dollar

Take the hit while people have the means to weather the blow rather than let a confluence of bigger, structural “macro” trends choke the economy into a slow recession or long period of stagnation that takes years to recover from.

If this happens, crypto will suffer along with everything else.

Many Republicans oppose this plan. Time will tell how things turn out. People float all sorts of interesting ideas. Often, they change their minds. We’ll know more within the next 100 days.

Whatcha gonna do, brother??

2025 may not turn out the way everybody expects. Longtime subscribers, this is nothing new.

In early 2023, I asked what you would do if Bitcoin's price went up to $57,000 by the start of 2024.

At the time, that seemed like a crazy talk. Bitcoin's price was barely $20,000. Everybody worried about a drop to $8,000 and a global recession.

Today, you'll find hardly anybody entertains the idea that the market peaked in December. A top this spring seems just as crazy. Most predict a full year of bull market mayhem and prosperity. Bitcoin’s price will hit $288,000 in October and other such notions.

Your mind latches on to the most extreme projections. What will you do if those predictions fail, as they did in 2023?

On some metrics, the peak is already in. We got awfully close to my danger zone.

I tweeted this chart about a year ago. See what’s happened since.

The idea seemed crazy at the beginning of 2024. Yet, here we are.

On a day-to-day basis, the market did not and will not hit specific prices and dates. That’s not the point.

Stepping away from the day-to-day and looking at the larger contours and movements of the market—the kind that will give you those low-effort, low-risk 200% or 300% gains—the market’s followed a reasonable path. At each step, this “reasonable” path seemed unrealistic and out of step with the general consensus.

If you follow my plan, you win either way. You have a strong allocation to the market, cash to spare, and no worries.

Enjoy this time. Speculate, trade, and flip memecoins and AI tokens. You might hit it big! I know somebody who made 50x on LUNA’s rise and 300% on its fall by catching a dead cat bounce during its collapse.

Don't sweat the swings. Follow Sankalp Shangari for trade recommendations, though I may give you a few along the way, too. I'll let you know when the time comes to put big money into the market.

As far as $500,000 Bitcoin and massive altseasons go, let's take it one day at a time.

The crypto market moves fast. When it's up, you can make fast money—if you're lucky and get your timing perfect.

Fast money is hard money. Hard to find, hard to get, hard to keep.

Slow money is easy money. You wait for good opportunities and let everybody else do the heavy lifting.

Those opportunities only come when the market goes down. When the market goes up, you have the option to sell at a profit or hold on for better days.

Cryptocurrency is a marathon masquerading as a sprint. They sell you on the sprint, but victory comes from the marathon. Hares get the attention. Tortoises win the race.

That doesn't mean rabbits can't have fun.

Relax and enjoy the ride!