The 2022 bear market is still the benchmark for the worst crypto cycle.
At the time, Bitcoin ended the cycle with a decline of over 60%, making it one of the steepest declines ever.
This also coincided with Jerome Powell beginning his second term as Fed Chairman on May 23, 2022, adding to the usual market uncertainty surrounding changes in Fed leadership.
Against that backdrop, it’s understandable that the market is comparing this cycle to 2022. However, with a new Fed chairman, Kevin Warsh, stepping in amid even tougher macro conditions, uncertainty is arguably higher than in 2022, something clearly reflected in 30-year US Treasury yields.
As the chart shows, 30-year U.S. Treasury yields closed at 5.14%, the highest level since the run-up to the 2008 financial crisis.
Similarly, 10-year Treasury yields are approaching a high of 4.9% in the fourth quarter of 2023, underscoring the impact of persistent inflation and making bonds relatively more attractive to yield-seeking investors.
Naturally, the chance of an interest rate increase in January is greater than 55%, while expectations for an interest rate cut are actually 0%.
All told, this cycle appears noticeably weaker than the crypto bear market of 2022. Notably, a recent report from the Federal Reserve also points out a key difference that supports this view.
The adoption of cryptocurrencies that require a lot of investment strengthens the speculation-driven market
A recent Federal Reserve report shows important data pointing to a growing cryptocurrency participation in the US.
It is striking that 10% of Americans used crypto in 2025, the highest level since 2022.
From a technical perspective, this looks like belief-led momentum, especially with crypto down 7.85% in 2025, marking the first bearish annual close since 2022. In that context, the rising usage could be interpreted as a bullish signal.
However, upon closer inspection the picture changes.
Crypto usage is still largely investment-driven and not utility-based, with around 9% of respondents using crypto for investment or trading purposes, compared to much smaller shares for payments and transfers. This clearly contradicts the growing ‘DeFi’ narrative in the market.
In support of this, the report shows that unbanked users (6%) are more likely to use crypto for transactions.
Simply put: crypto payments are not mainstream.
Instead, crypto is more relevant among the unbanked where access to traditional banking is limited. To put this into perspective, only 2% use crypto for transactions where banking services are available and prefer to choose crypto for payments.
Therefore, the 10% crypto adoption among Americans remains largely speculative, while DeFi momentum is still weak. This corresponds to a macro-sensitive crypto cycle, ending the year up over 7%, reinforcing the view that this cycle could become weaker than 2025 as macro FUD climbs back to pre-2022 levels.
Final summary
- Macro conditions are still tighter than in 2022, with high interest rates and restrictive policies keeping risk appetite weak.
- Cryptocurrency usage is largely investment-driven, rather than payments or DeFi, showing a still-speculative market cycle.