Crypto Long & Short: Six signs a crypto winter is ending

Happy Wednesday,

This is your institutional newsletter, Crypto Long & Short. This week:

• Six indicators have marked the end of past crypto winters. Denny Galindo of Morgan Stanley Wealth Management checks how many are flashing now.
• Top headlines institutions should pay attention to by Helene Braun
• “Pump.fun Custom Pools: Meme-Stock Bet Meets Muted Volume” in Chart of the Week

Thanks for joining us!

– Kim Klemballa

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by Denny Galindo, CFA, executive director, Global Investment Office, Morgan Stanley Wealth Management

Digital assets have, from our limited historical observations, typically followed a four-year cycle. Each of the four completed cycles has included a three-year bull market followed by a 12- to 14-month bear market, often dubbed crypto winter. It’s unclear why this cycle persists, but there are reasonable top-down and bottom-up explanations. Fortunately, we do not need to know which cause of the cycle is the most important. Our framework for understanding the four-year cycle features four “seasons” of cryptocurrency. The current crypto winter has largely followed the historical pattern, but our focus has recently shifted to the next season.

Historically, in limited observations, “crypto spring” has begun quietly, with prices stabilizing while public interest remains subdued. Several indicators that have historically marked the transition from crypto winter to crypto spring appear present today. These observations are not predictions, and these may prove false or premature signals, but each sign is worth monitoring in the months ahead.

1) Cycle length: Spring has historically begun 17 months before the supply halving or 12 to 14 months from the prior peak. September is 17 months before the next halving and 11 months from the prior peak.

2) Exchange and institutional stress: Major exchanges have failed or closed just before crypto spring begins. BitMEX announced in July that it would close in September.

3) Drawdowns of 77% to 84% below prior peaks: Bitcoin’s drawdown of 53% (Bloomberg price data from October 6, 2025, to June 30, 2026) may be sufficient to count as a sign, but remains shallower than those of previous crypto winters.

4) Bitcoin difficulty: An indicator of how hard it is to mine a bitcoin, difficulty typically declines at the end of a crypto winter and then increases to mark crypto spring. While difficulty has declined, it has not yet rebounded.

5) Thermocap multiple: The thermocap multiple is a measure like price to book that compares bitcoin’s market capitalization to the cumulative dollar value ever paid to miners, with each coin valued at its market price when it was mined. Prior crypto winters ended at single-digit multiples, but this cycle it only declined to 13 times, according to Glassnode data as of June 30, 2026. These levels are not a guarantee of future price action.

6) Price action: A 50% rally from the low has historically coincided with prior market troughs, although no such relationship guarantees future outcomes.

Once the next cycle does begin, we expect two key debates to persist throughout:

Will bitcoin reach a new high before the next halving? During both the 2012 to 2016 cycle and the 2016 to 2020 cycle, bitcoin did not surpass its prior cycle high until after the halving. However, in the 2024 cycle, bitcoin surpassed the 2021 high one month before the April 2024 halving, according to Bloomberg data.

Has AI replaced crypto as the market’s leading speculative/disruptive-technology narrative? In 2020 and 2021, crypto was one of the clearest expressions of a high-liquidity, disruptive-technology market. Since 2024, however, AI has become the dominant growth story.

Neither debate will be settled quickly, which is why we are watching the six signs above rather than waiting for an answer.

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By Helene Braun

Several of crypto’s biggest narratives converged this past week as bitcoin’s

BTC$75,756.52

price chart flashed a golden cross that could point to a longer-term bullish trend, Coinbase CEO Brian Armstrong argued the industry stands to gain regulatory clarity regardless of the Clarity Act’s fate and India’s richest state, Maharashtra, explored tokenizing power infrastructure and other state assets to raise money for new projects.

• Bitcoin’s golden cross is here: A golden cross has triggered on bitcoin’s daily price chart, indicating a potential long-term bullish trend ahead.
• Crypto wins regardless of Clarity Act vote, Coinbase’s Armstrong says: Coinbase CEO tells CNBC the crypto industry gets regulatory clarity whether or not the Senate passes the bill on Sept. 15.
• India’s richest state considers selling tokenized claims of its power assets to fund new infrastructure: Maharashtra is drafting a policy to tokenize the state’s assets, including the electricity transmission infrastructure.

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Pump.fun Custom Pools: Meme-Stock Bet Meets Muted Volume

Pump.fun rolled out custom pools, letting creators pair memecoins against non-SOL tokens – a direct response to the rising memestock narrative. So far the impact on daily volume has been limited: it spiked past $500M on Sep 10, but has since settled back into the $390M–$450M range.

Looking for more? Receive the latest crypto news from coindesk.com and market updates from coindesk.com/institutions.