GM,

Welcome to this week's Phenom Weekly Update. Today we are looking at how the business cycle can be used to time crypto markets.

As the global economy navigates through its cyclical phases, cryptocurrencies like Bitcoin often mirror these macroeconomic trends. Historically, Bitcoin's price movements have shown correlations with business cycle indicators, suggesting that economic expansions and contractions can influence investor sentiment and, consequently, crypto valuations. Not exactly rocket science but useful as a forward indicator.

In other news:

• Twenty One Capital's Major Bitcoin Acquisition: Brandon Lutnick, in collaboration with SoftBank and Tether, has launched Twenty One Capital, a $3.6 billion venture aiming to acquire 42,000 bitcoins. This move positions the firm as one of the largest holders globally, reflecting growing institutional interest in cryptocurrency.

• Upexi's Strategic Shift to Solana: Upexi, a Tampa-based internet company, saw its stock surge by 335% after revealing plans to raise $100 million to build a treasury of Solana tokens. This strategic move mirrors the successful crypto investment approach of firms like MicroStrategy.

Scroll down for a deeper look at the business cycle and more of the top news in crypto this week.

What the Business Cycle Tells Us About Cryto

I’ve been doing some thinking about the business cycle recently as it relates to crypto when I stumbled across a post on X by Kyle Reidhead that I thought was pretty spot on. He’s got a chart showing how the ISM Purchasing Managers Index (PMI) tracks bull and bear markets, especially for crypto, and it’s hard to ignore the data. It’s not flashy but it’s the kind of thing that makes you sit up and pay attention.

The ISM measures U.S. manufacturing activity. It’s a simple metric: above 50 means the economy is expanding; below 50, it’s contracting. Reidhead’s chart lays out the cycles like a roadmap. You can see bear markets in 2014 and 2022 when the ISM dipped below 50, and bull markets in 2016-17 and 2020-21 when it climbed above. Right now, as of April 2025, the ISM is sitting at about 48—still in contraction territory, but it’s been ticking up. That’s where things get interesting for crypto.

Bitcoin tends to outperform when the ISM is rising but still under 50, which is exactly where we are now. Altcoins, on the other hand, don’t really take off until the ISM crosses into expansion territory above 50. Looking at the ISM chart, you can see altcoins went on a tear in 2017 and 2021, right as the ISM hit that magic threshold. If the ISM keeps climbing, we might be staring down an altcoin season soon. But if it stalls we could be in for a rough ride.

The data isn’t just a one-off. A TradingView analysis I found backs this up, noting that Bitcoin’s cycle low often leads the ISM low by about a year, though their highs tend to align. This has held true since 2013. Even macro analyst Raoul Pal chimed in on X recently, saying that if the ISM keeps rising, Bitcoin could hit $300,000 by 2026. He’s also watching the business cycle, which he says has been slower to recover since 2020.

What’s driving all this? Liquidity, apparently. Reidhead mentions that financial conditions lead liquidity, which then drives the ISM. Raoul also shows Bitcoin’s price tracking closely with global M2 money supply (the chart I shared last week), reinforcing that liquidity matters more than politics or interest rates.

Here’s what I’m keeping an eye on:

• ISM crossing 50: If it breaks into expansion, altcoins could surge like they did in past cycles.

• Liquidity trends: Central banks are still in easing mode, which could keep pushing markets higher.

• Economic slowdown: If the ISM stalls below 50, we might be headed for a bear market.

READING CORNER

A collection of longer form content we are consuming this week 

NEWS

Quick Hitters from the week

1. Coinbase Confirms It’s Considering a U.S. Banking Charter
   Coinbase is exploring the possibility of obtaining a federal banking charter, a move that could allow the exchange to offer traditional banking services like deposit-taking and lending. 🔗 Read more

2. Fartcoin Flips Bonk, Tops Solana Meme Coins at $1B Market Cap
   Fartcoin, the latest meme sensation on Solana, has surpassed Bonk in market cap, climbing to over $1 billion with more than 148,000 holders. 🔗 Read more

3. SEC Drops Fraud Case Against HEX Founder Richard Heart
   The SEC has officially dropped its case against Richard Heart, founder of HEX, PulseChain, and PulseX, after missing a deadline to amend its complaint. 🔗 Read more

4. PayPal to Offer 3.7% Yield on PYUSD Stablecoin This Summer
   PayPal will begin offering U.S. users a 3.7% annual yield on holdings of its PYUSD stablecoin starting this summer, joining the race to make stablecoins more attractive. 🔗 Read more

5. Trump Memecoin Soars After Gala Dinner Announcement
   The Trump-linked TRUMP token spiked 58% after the former president announced a gala dinner for the top 220 holders, including a White House tour for the top 25. 🔗 Read more

6. Bolt’s Ryan Breslow Unveils Crypto Payments Superapp
   Bolt founder Ryan Breslow has launched a new app aiming to rival Coinbase, Zelle, and PayPal by combining crypto trading, peer-to-peer payments, and debit card rewards into one sleek platform. 🔗 Read more

7. South Korea’s Central Bank to Push Forward Stablecoin Legislation
   The Bank of Korea has pledged to actively help shape stablecoin laws, signaling a more hands-on approach to regulating digital assets in the country’s next wave of crypto policy. 🔗 Read more

8. Bybit CEO Says 28% of $1.4B Stolen Crypto Has ‘Gone Dark’
   Bybit CEO Ben Zhou revealed that nearly a third of the funds from the platform’s massive hack are now untraceable, with attackers using mixers and bridges to obscure the trail. 🔗 Read more

9. Bank of America, Circle, and Tether Battle Over Stablecoin Rules
   The fight for influence over U.S. stablecoin regulation is heating up, with Bank of America pushing for bank-led oversight while Circle and Tether defend fintech-friendly frameworks. 🔗 Read more

THE TWITTERVERSE

A collection of the most interesting stuff on Crypto Twitter this week

MEMES

For the (crypto) Culture

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