Unit 4 · Level 3 · Crypto Deep-Dive
Narratives & cycles
More than any market on earth, crypto moves in NARRATIVES: DeFi summer, NFTs, AI tokens, memecoins, RWAs. A narrative concentrates the crowd's attention (and its money) into one sector for weeks or months, then rotates. Riding narratives early is lucrative; arriving late is how bags are made.
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What you get asked
Why do narratives move crypto prices so violently?
Attention and flows ARE the fundamentals, short-term. A stock has earnings gravity. A narrative token has believers and float. When belief rotates away, there's often nothing underneath. Remember your tokenomics training.
Order the classic narrative lifecycle
By the time a narrative is on mainstream feeds, you're usually in stage 3-4. The crowd arriving IS the exit liquidity; you learned this in the FOMO lesson.
Bitcoin's ~4-year cycle rhythm (halving → bull → blow-off → bear) is…
Each cycle rhymed differently, and past ≠ future. Three-ish observations don't make physics. Cycle awareness is context (where might we be?); cycle certainty is a trap (it MUST pump now).
Trading a narrative late means providing exit ___ to those who arrived early.
Someone sells every top tick, usually to the most excited buyer in the room. Narrative trading is a queue; your P&L depends on your place in it.
How does a DISCIPLINED trader engage with narratives?
Treating it as momentum trading, never as investing. Narratives are real flows, tradable with League 2 risk armor. The fatal version is narrative FOMO wearing an 'investing' costume. Know which game you're playing. 🐜
The rest of this unit
CEX vs DEX, stablecoins, yield forensics, and narrative cycles: fluent crypto, kept skeptical.