- Crypto relies on external inflows as costs outweigh weak organic revenue growth.
- High leverage near 8x means small sell-offs could trigger outsized market drops.
- ETF inflows may be fading, while the 2028 halving poses a risk to cycle stability.
Cryptocurrency markets face an unavoidable reckoning unless fresh capital offsets rising structural costs, according to the Founder of CoinEx, Yang Haipo, who argues the industry now depends on increasingly fragile financial support. He contends that crypto no longer grows through organic economic utility but through external inflows that sustain a system burdened by high operating expenses.
His thesis centers on a stark imbalance, the industry consumes tens of billions annually, yet generates limited outside revenue. Consequently, he believes the sector has entered a late-stage phase where shrinking liquidity, rising leverage, and exhausted buyer growth raise the risk of severe contraction across digital assets.
Rising Costs and Weak Revenue Raise Pressure
Yang estimates the crypto industry burns between $60 billion and $80 billion each year. He places corporate operating costs alone at $35 billion to $50 billion.
Mining accounts for roughly $10 billion to $15 billion. Exchange operations add another $15 billion to $25 billion. Project teams and service providers contribute billions more.
Moreover, he estimates historical deadweight losses have surpassed $1 trillion. That figure includes about $500 billion in cumulative operating costs. It also includes $30 billion to $50 billion lost through hacks, fines, and seizures. He argues personal spending by market participants likely pushed total dissipation far higher.
Besides, Yang sees weak external revenue as the industry’s core flaw. He argues transaction fees recycle user capital instead of bringing in outside demand. Stablecoin payments and settlements provide utility, he says, but support only a small portion of the sector’s scale.
He estimates real circulating crypto market capitalization stands near $1.6 trillion, despite a nominal $2.5 trillion total. However, he places the actual margin backing at only $200 billion. That implies effective leverage near 8x. Consequently, even modest selling pressure could trigger outsized market declines.
ETFs Bought Time, But Buyer Growth May Be Fading
Yang argues that spot Bitcoin ETFs and Digital Asset Treasury firms injected about $200 billion during 2024 and 2025. Significantly, he views money as a rescue mechanism rather than organic growth. Without those flows, he believes the system’s margin pool may have approached exhaustion.
Additionally, he says ETF capital flowed into Bitcoin without attracting new users into the broader crypto economy. That, he argues, helps explain why Bitcoin hit records while many altcoins lagged.
He also warns that those support channels may weaken. Strategy accumulated 767,000 Bitcoin for $58 billion, while other treasury buyers sharply reduced purchases. Meanwhile, ETF outflows have begun appearing during recent pullbacks.
2028 May Test Market Survival
Yang identifies the 2028 halving as a major stress point. If Bitcoin fails to reach new highs, he argues that confidence in recurring recovery cycles may break. Hence, panic selling could intensify as liquidity drains.
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