Happy Friday!

The bitcoin blues are real today, though We’ve been told by many a bull that there’s still a few weeks left in December to hit another new all-time high. We’ll just have to see if that pans out. 

Keep calm and carry on, as the UK government once advised. We think it’s pretty relevant right now. 

Anyway, this morning, we’re diving into this cycle and why it’s really not that different from past cycles (sorry, y’all) and a lot of people have thoughts on AI agents and where they go from here. 

See you bright and early Monday.

☝️ This time is no different

It’s always tempting to go against the grain. To believe this time is different.

The problem with that is, at least in crypto, everything that is happening today has already played out in the past. 

Bitcoin bull markets have so far been cyclical and, therefore, even predictable.

With the exception of BTC’s all-time high before the halving this time around — rather than around six months after the fact — the current bitcoin bull market is totally par for the course.

Those who’ve been reading our emails are familiar with the chart below. It plots our current run (purple) against previous cycles (the others) as if they all started at once.

As you can see, this bitcoin bull run to date is entirely standard. Not especially fast, slow or explosive, and more or less in line with the previous bull run.

Bull market trajectories have indeed been similar over the years. But there are still emerging trends:

1. BTC is taking longer to reach cycle peaks each time.

Bitcoin topped about 750 days into its first major bull market cycle between 2011 and 2015. 

It took 845 days to peak in the following bull market between 2015 and 2018, and more than 1,060 days in the one after, which spanned 2018 and 2022.

Today is day 746 of the bull market. If the trend holds, we could see another 10 months to a year before a real peak.

2. Returns are shrinking.

Bitcoin went almost 621x in the first run, over 100x in the second and nearly 22x in the third.

Extrapolating that downward trend implies BTC would go about 6x from the bottom of the bear to the cycle top. 

Good news: We’ve already smashed those returns — BTC at $100,000 is 6.7x.

Above is the same chart but for altcoins (everything that isn’t bitcoin).

We already know that we’re getting closer to a potential fully-fledged altcoin season. What’s interesting is just how far altcoins will need to run to match their growth from the last cycle. 

The market cap of crypto (excluding bitcoin) had gone 49x by the time it peaked in November 2021. To date, altcoins have done 3.7x at most. 

It’s reassuring, at least, that it took altcoins more than 1,000 days to peak on the past two occasions. 

So, if this time truly isn’t different, there’s still plenty of time for alts. 

Nothing quite like hopium on a Friday morning.

— David Canellis

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It’s all about AI. 

The rise of AI agents is a “narrative trade,” AllianceDAO’s Qiao Wang told Empire podcast host Jason Yanowitz. 

Mostly because he’s of the belief that building a “really good product, like this… is going to take a lot more time than just a few months.”

So he’s giving it two years, at least, to develop before he labels AI agents as anything other than a narrative trade. But it’s “hard to say” whether useful products will come out of this sudden boom, because right now it’s just “entertainment,” Wang said.

“AI is very programmable, and crypto is very programmable. And you mix the two together, there's going to be something interesting,” he continued. But “in order to get deep, you have to spend a lot of time with a specific project,” which makes it difficult.

And now you know. 

Wang isn’t the only one keeping a close eye on AI and crypto’s developing relationship.

Earlier this week, a16z released their big ideas for 2025, and AI, unsurprisingly, was mentioned a lot. In the actual Big Ideas list, it was included over 250 times, for example. 

I thought a16z’s Carra Wu had an interesting take on AI agents and how they’re changing.

“As AIs make the transition from NPCs (non-playing characters) to being the main characters, they will begin to act as agents,” she said. “However, until very recently, AIs haven’t been able to act truly agentically. And they are still unable to participate in markets — exchange value, reveal preferences, coordinate resources — in a verifiably autonomous (read: not human-controlled) way.”

She notes that some AI agents can utilize crypto for transactions, which creates opportunities for content. But that’s not the end game for AI agents “both in fulfilling human intents, and in becoming standalone network participants.”

“As networks of AI agents begin to custody their own crypto wallets, signing keys, and crypto assets, we’ll see interesting new use cases emerge. Such use cases include AIs operating or verifying nodes in DePIN (decentralized physical infrastructure networks) — for example, to help with distributed energy,” Wu continued

If her thesis plays out, AI agents could even own and operate a blockchain.

And from there they’ll take over the world! Just kidding… kind of. It’s clear that AI is here to stay, but I’ll be closely watching how it integrates itself into crypto.

— Katherine Ross

Last week, we asked: “Did you talk about crypto at the Thanksgiving table?”

All of you replied “I’m not even American.” That’s okay, your secret is safe with us.

This week, we want to know: