Silicon Valley venture capital firm Andreessen Horowitz believes we have entered a “fourth crypto cycle” with new all-time highs for Bitcoin on the horizon.
The firm has analyzed 10 years of data, including Github commits, Reddit comments in crypto subreddits and Pitchbook funding data.
With this information the venture capital firm have discovered an “underlying order” to the first three 2011, 2013 and 2017 bitcoin and crypto cycles.
At the beginning of the cycles, the price of bitcoin and other cryptocurrencies rises, leading to social media activity renewed interest.
Projects start up, code gets written and products are launched. These product launches inspire more people which triggers the next cycle.
Bitcoin is on track to be one of the year’s best performing assets and the crypto friendly hedge fund are betting big on crypto for the long term.
Only last month the venture capital firm, based in Silicon Valley, raised a staggering $515 million that focuses on blockchain technology, the database innovation behind cryptocurrencies adding to the $300 million fund it launched in mid-2018.
Chris Dixon, coleader of the fund, clearly believes that cryptocurrency assets like Bitcoin and Ethereum will be part of a pending technological paradigm shift and Horowitz want to be involved.
“IT’S VERY RARE THAT MAJOR, NEW COMPUTING PARADIGMS COME ALONG, AND WE THINK THIS IS ON THE SCALE OF CLOUD AND MOBILE FOR THE INTERNET,”Chris Dixon – Andreesen Horowitz
Katie Haun, a who coleads the crypto fund and sits on the board of the Facebook-corralled Libra Association, has told press that the firm plans to hold on to its bets for the long term, as long as 10 years.
Bitcoin’s much anticipated halving finally took place at 3:23 pm EST on Monday, May 11th.
A halving happens every four years and is a planned reduction in rewards miners receive.
In 2009, miners received 50 Bitcoin per block, reduced to 25 in the first halving, in 2012, to 12.5 in 2016, and has now fallen to 6.25.
The halving prevents inflation by slowing the pace at which Bitcoin are created, so as to not outstrip demand.
Some experts believe it will make mining unprofitable and cause the price to drop considerably while others believe the value could appreciate hugely due to the supply being more scarce.
Either way Andreesen Horowitz betting big for the long term and are bullish on crypto.