Polygon Founder Predicts Permanent Shift in Crypto Market Cycles Amid Institutional Adoption and High Interest Rates
Sandeep Nailwal, co-founder of Polygon, suggests the traditional four-year crypto market cycle is evolving due to the maturity of crypto as an asset class and increased institutional involvement. US high interest rates have reduced speculative activity, yet future declines in these rates could reignite speculation. The introduction of crypto ETFs and policies during Trump’s administration have bolstered crypto’s legitimacy, changing capital distribution from large to smaller-cap assets during bull runs. However, recent trends show capital may shift towards larger caps amid market stability. This reflects a less volatile environment, indicating a long-term market transformation.
Neutral
The evidence suggests the crypto market is maturing, with institutional adoption and regulatory changes offering stability and legitimization, which moderates traditional volatility. While introduction of ETFs and policies boost adoption, high interest rates currently suppress speculative activity. Market shifts indicate adaptability towards less volatile assets like large-caps, presenting a balanced environment for traders in both short and long terms.