We are still in a Supercycle of encryption, but not the one you expect.

Original Title: The Supercycle Is Here. Just Not the One You Were Promised

Original author: Lomashuk

Compiled by | Odaily Planet Daily; Translator | Asher

Recently, a casual five-minute scroll on X easily leads to one conclusion: we are back in a bear market. BTC prices continue to decline, and altcoins are also in a constant downward trend, with retail sentiment nearly evaporating. The ultimate bull narrative proposed by Su Zhu, which embodied the industry's imagination of “crypto assets breaking free from cyclical constraints and achieving escape velocity”—the “Supercycle”—now seems more like a collective illusion.

However, the supercycle has not ended. The real issue is that we have been misreading it all along. In traditional narratives, the supercycle is an eternal prosperity where “digital always goes up,” representing a complete embrace of crypto by traditional finance, allowing the market to break free from the four-year cycle of boom and bust. However, as more and more people directly deny this vision, we instead see a deeper, more sober reality — the supercycle has indeed started, just in a way that is entirely different from what people once imagined. In fact, as crypto accelerates its integration into global finance, 90% of the assets in the market are being ruthlessly revalued to nearly zero.

The major differentiation in the cryptocurrency market

The most undeniable reality is that this cycle, the era of “a rising tide lifts all boats” has completely come to an end. In past bull markets, retail investors could casually pick a altcoin on CoinMarketCap and earn decent returns in the next market movement. But the current market presents a starkly different answer - the vast majority of altcoins are falling indiscriminately, with no signs of reversal.

In fact, most crypto assets are slowly heading towards zero. Once-prominent meme coins, countless governance tokens, “Ethereum killers,” and the air projects from the last cycle - they no longer have the potential to return to historical highs. The silence in prices reflects not a temporary emotional downturn, but the fact that they have lost their survival value in the current narrative and fundamentals; they have become true “zombie assets.”

At the same time, the market structure is maturing, and investors are more rational than ever. Capital is no longer willing to pay for a white paper, a vision, or a Discord community, but is returning to basic fundamentals such as cash flow, fee income, and use cases.

In such a differentiated pattern of the cryptocurrency market, only two types of assets can transcend cycles:

• Has become a systematic infrastructure public chain - such as Ethereum, Solana;
• A protocol capable of continuously generating real fees and income.

Apart from that, Web 3 projects, no matter how dazzling the narrative, are being ruthlessly eliminated by the market.

The continuous evolution of encryption

Despite the speculative sentiment at the price level plunging to a low, the underlying architecture of the global financial system is undergoing a silent yet profound rewrite. For a long time, “regulation” has been seen as the biggest obstacle for the entire industry; however, in 2024 and 2025, this shadow hanging over us unexpectedly transformed into certainty. The increasingly clear policy framework has not stifled this technology, but instead, it has illuminated a green light for those giants that were once regarded as traditional “enemies.”

At the same time, the supply of stablecoins is hitting new historical highs with unstoppable momentum, becoming a new engine of global liquidity.

New types of internet banks are evolving into crypto-native financial gateways, while Visa and Mastercard are directly embedding stablecoin settlements into their core payment networks:

• Visa is processing billions of dollars in stablecoin transactions, providing the underlying power for the next generation of internet banking;
• Mastercard acquires ZeroHash;
• Stripe fully transitions to stablecoins as the infrastructure for global payments;
• CashApp integrates USDC in the front end;
• Revolut launches a zero-fee stablecoin exchange path.

They may all realize that to continue to survive, they must embrace this technology rather than resist it. This deep integration is forming a sticky and irreversible demand base — one that will not be reflected in short-term speculative markets but will continue to amplify in real global trading volume.

Funds may return to the chain.

The macroeconomic environment is quietly changing the rules of the game. With the Federal Reserve cutting interest rates and ending quantitative tightening (QT), the once easily obtainable 4% risk-free return on U.S. Treasuries is gradually disappearing, and in the face of declining yields, capital will not remain idle.

A trend of large-scale capital inflow onto the blockchain is about to emerge, but unlike before, this time the funds will not flow into Ponzi-style projects, but rather towards DeFi protocols that can generate real returns through trading fees and lending interest differentials. As traditional yields decline, the actual returns of DeFi protocols are becoming a new capital haven, and data has already shown this — Aave's TVL has reached a historic high, further reflecting the market's strong pursuit of genuine on-chain returns.

Next Generation Decentralized Finance and Artificial Intelligence Economy

Cryptographic infrastructure is being leveraged by new financial primitives, which have finally found their product-market fit. Derivatives and perpetual contracts initially gained preliminary recognition among the “geek player” community, but are now expanding into a liquidity on-chain hedging environment available for institutions. Prediction markets have also evolved from niche experiments into reliable global information sources: Google has integrated Polymarket, and Kalshi has partnered with the NBA.

However, the ultimate catalyst that makes this round of super cycle truly unstoppable is artificial intelligence. We are building a world composed of AI agents that will not walk into JPMorgan Chase to open a checking account, but will directly generate wallets, conduct transactions, exchanges, and pay fees using cryptocurrencies, and they will instantly create new auction markets based on user intent.

In this system, blockchain will become the native underlying layer of the “cyber economy”, with AI agents coordinating and trading on top of it.

Summary

We are currently in a real super cycle, but it is completely different from the frenzy and short-term surges of 2021. The current super cycle is quieter, more stable, and structural: it no longer relies on speculative sentiment and does not cause all assets to rise together.

In this process, those tokens and projects that have no actual value will continue to decline in price, which is the natural filtering mechanism of the market. At the same time, cryptocurrencies are quietly integrating into the global financial system, from stablecoin settlements to institutional on-chain hedging, from payment infrastructure to the underlying AI economy, blockchain is becoming the new infrastructure of the global economy.