Financial bubbles are a hot topic, with academic papers defining them as periods of unsustainable growth. Bitcoin has experienced exponential growth followed by sharp declines, with previous winter declines hitting -91%, -82%, -81%, and -75%. The price trend follows distinct cycles, with halving every 4 years affecting growth.

A statistical indicator called the Diaman Ratio measures Bitcoin’s growth sustainability. Analysis shows periods of more than exponential growth in previous cycles, while recent cycles have seen lower values. Volatility has declined over the years, leading to stable prices and lower expected returns.

Bitcoin’s returns have gradually declined, with no peak returns in the last cycle. Despite this, the asset has seen significant growth from $15,000 to $126,000. Wealth generated per cycle has increased, confirming Bitcoin’s ability to generate wealth. The approval of ETFs has changed the traditional Bitcoin cycle, leading to greater stability in returns.

Read more at Cointelegraph: Is That Good Or Bad?