CZ explains why crypto has had the worst year since 2018 - and he is not wrong

Changpeng Zhao - CZ, founder of Binance - has explained why crypto has had the year it has had. His answer is not one thing. It is three things: artificial intelligence eating investor attention, global geopolitical tension, and the four-year market cycle doing exactly what four-year market cycles do. The crypto market is down around 50% over the past year. CZ says no single cause is responsible.

That framing matters because the single-cause narrative has been running hard. Some people blame regulation. Some people blame macro. Some people blame specific events - the Binance settlement with the DOJ, the collapse of this exchange or that protocol, the general fog of institutional caution. CZ is saying the picture is more complicated than any one of those reads.

The AI argument

The first factor - AI absorbing capital and talent that would otherwise have gone into crypto - is underreported. The venture capital money that funded crypto's last bull run is now split between web3 projects and AI companies. And the AI opportunity, right now, looks more tractable. You can build a product, raise money, find enterprise customers. The crypto opportunity, in 2026, requires navigation of a regulatory environment that is still being written.

That is not a permanent condition. But it is the current one, and CZ is acknowledging it.

The four-year cycle

The halving cycle argument is the one that long-term Bitcoin holders return to in every downturn. The pattern - roughly: halving, 12-18 month lag, bull run, correction - has played out enough times to be taken seriously. CZ's point is that where we are right now, in the cycle, is the down period before the next run.

Whether that framing is correct or whether it is a narrative that makes sense in retrospect better than it predicts the future is the permanent debate inside crypto.

Our take: CZ is offering a more honest read than most. The 50% drawdown is not one thing. It is everything compressing at once. The question is whether the cycle argument holds this time, or whether this is the cycle that breaks the pattern.