Part 1 Advanced The Market Maker’s Exchange Checklist (Liquidity, Latency, and Risk Controls) Market makers and HFT desks: evaluate exchanges on execution quality, liquidity, latency, fees, margin, and security — with a WhiteBIT walkthrough. Open guide Analysis challenges Bitcoin diminishing returns theory amid recent gains
Bitcoin's current cycle showcases strength with a nearly 287% appreciation from the low, challenging the diminishing returns theory.
Quick Take
The diminishing returns theory, suggesting that Bitcoin will yield lesser returns with each cycle, is a subject of intense scrutiny. The examination of this theory from two points of view, the cycle low and the cycle all-time high, provides interesting insights.
In November 2022, Bitcoin's cycle low occurred during the FTX collapse, dropping to roughly $15,500. Since then, Bitcoin has managed a staggering 287% appreciation, outpacing the returns of the 2015 to 2018 cycle (173%) and the 2018 to 2022 cycle (106%).

Considering the cycle from its all-time high, the bear market began shortly after the peak in April 2021, presenting a similar narrative.
We observe that Bitcoin has already hit its all-time high from April 2021 of roughly $63,000, a significant improvement compared to the previous cycles. At this juncture in the 2013 to 2017 cycle, Bitcoin needed roughly a 35% increase, and during the 2017 to 2021 cycle, a 20% increase was needed.
In conclusion, while this analysis doesn't necessarily refute the diminishing returns theory, it highlights the strength of the current Bitcoin cycle.


















