The Benner Cycle: Why Crypto Traders Should Not Ignore This 150-Year-Old Theory

While most traders swear by complex technical indicators and artificial intelligence, they often overlook an astonishingly effective forecasting method that has been working for 150 years – the Benner Cycle. This theory, developed by Samuel Benner in the 19th century, seems tailor-made for today’s cryptocurrency market. But why is that?

The Hidden Logic Behind Repeating Market Patterns

Financial panic, prosperity, and decline – these three states repeat throughout history with remarkable regularity. The Benner Cycle is based on a simple but profound observation: markets follow psychological cycles closely tied to human behavior. American farmer and entrepreneur Samuel Benner discovered this pattern not in economic textbooks but through personal financial adventures.

After suffering significant losses due to crop failures and economic crises, Benner set out to understand the causes of these recurring crises. What he found was a self-repeating rhythm of exuberance, collapse, and recovery. His observations led to the 1875 publication of his groundbreaking work “Benner’s Prophecies of Future Ups and Downs in Prices,” which laid the foundation for a completely new understanding of markets.

The Three-Pillar System: How the Benner Cycle Works

The Benner Cycle divides into three repeating phases that occur over different timeframes:

Panic Phases (A-Years): During these critical years, financial crises or market panics occur. Benner recognized that these events follow a predictable pattern – panic returns every 18 to 20 years. He identified years such as 1927, 1945, 1965, 1981, 1999, and 2019. These phases are characterized by sudden losses of wealth, loss of confidence, and irrational fear.

Peak Selling Years (B-Years): These are the years of extreme euphoria when markets reach their peak and prices seem exaggerated. Investors are overflowing, valuations are inflated, and psychologically, markets are at their highest point. Benner identified years like 1926, 1945, 1962, 1980, and 2007 as such peaks. Those who liquidate positions during these years can secure massive gains.

Buying Opportunities (C-Years): These are the gold mines for long-term investors. In 1931, 1942, 1958, 1985, and 2012, prices hit their lows. Assets—whether stocks, real estate, or commodities—are affordable, and those who accumulate during these phases later sit on substantial profits.

From Agricultural Products to Bitcoin: Universal Applicability

Originally, Benner’s research focused on agricultural commodities like pork, corn, and iron. But the elegant simplicity of his logic later enabled traders and analysts to apply the Benner Cycle to any asset class – stocks, bonds, commodities, and now cryptocurrencies. The psychology remains the same, regardless of whether you’re predicting pork prices or Bitcoin.

The Benner Cycle Meets Cryptocurrencies: A Perfect Fit

The cryptocurrency market is almost predestined for the Benner Cycle. Bitcoin and Ethereum follow extreme emotional cycles – phases of feverish euphoria alternate with periods of total despair. This emotional volatility is not irrational; it follows patterns.

Look at 2019: The market indeed experienced a correction that perfectly aligned with Benner’s panic forecast for that year. Looking ahead, the Benner Cycle suggests that 2026 could be a year of potential prosperity and high valuations – similar to 1926, 1945, and 2007 before it.

For crypto traders, this opens concrete trading strategies: during B-Years, strategically reduce positions to lock in profits; during C-Years, aggressively accumulate when fear is at its peak and prices are at their lowest.

Why This Old Framework Still Works

The reason is simple: human psychology has not changed. Greed and fear drive markets – then as now. Technology may evolve, platforms may change, but the fundamental drivers remain constant. The Benner Cycle is essentially a formalization of these eternal human weaknesses and strengths.

For Bitcoin holders and Ethereum speculators, this means: the cyclical patterns that Benner identified over 150 years ago can serve as a navigational aid through the most volatile markets of our time. A combination of psychological understanding and Benner’s mathematical rhythm creates a robust framework for strategic decisions – both in times of panic and moments of euphoria.