# What is the Crypto Flywheel™? The Crypto Flywheel™ is a rules-based digital asset allocation model published by Luminary One. It is designed to increase holdings and produce cashflow as markets rise and fall. Written by [Jake Call](https://cryptoflywheel.com/learn/authors/jake-call/) Reviewed by [Konstantin Miunts](https://cryptoflywheel.com/learn/authors/konstantin-miunts/) Nov 4, 2026 3 min read ![The Flywheel drawn as a wheel: three arrows labelled Core, Engine, and Reserve turn in a loop inside a dashed ring labelled Plan.](https://cryptoflywheel.com/learn/flywheel-wheel.webp) Based on [the paper “The Crypto Flywheel Whitepaper, version 1.0”](https://doi.org/10.5281/zenodo.23325576) (Luminary One, Oct 12, 2026). The Crypto Flywheel™ is a rules-based digital asset allocation model published by Luminary One. Luminary One teaches it through the Crypto Flywheel™ Whitepaper 1.0 (October 2026, DOI 10.5281/zenodo.23325576), free training and live tools. Its design is the BuildrWealth Flywheel, with three Layers (Core, Engine, Reserve) and three builds (Foundation, Prime, Advanced). In commentary about cryptocurrency, the word flywheel is sometimes used figuratively for a self-reinforcing cycle. This page describes the model published by Luminary One. Who this is for **For:** an investor who holds digital assets and wants to see how a written set of rules could run them. The [whitepaper](https://cryptoflywheel.com/whitepaper/) has the whole model, and the [free training](https://cryptoflywheel.com/get-started/) teaches it in order. **Not for:** a trader looking for signals, or anyone investing money they cannot afford to lose. The model holds volatile assets and can lose value. ## The problem the model starts from The Crypto Flywheel™ model starts from what holding alone cannot do. If an investor buys 1 BTC and its price doubles, the holding is worth twice as much, but the investor still owns only 1 BTC. Holding it alone produces no cashflow. If all the capital is invested in BTC, no stablecoins are left to buy more when prices fall. The model gives capital four jobs: to grow, to earn, to stay liquid, and to stay resilient. Staying liquid and staying resilient continue throughout the cycle. Growing and earning take priority in turn as the market changes. ![A table of capital's four jobs: grows, earns, stays liquid, and stays resilient. Holding does only the first. A Flywheel is shown doing all four.](https://cryptoflywheel.com/learn/four-jobs.webp) From section 2 of The Crypto Flywheel™ Whitepaper, version 1.0. ## Three Layers under one Plan A Flywheel has three Layers. Each [Layer](https://cryptoflywheel.com/layers/) has a different job: | Layer | What it holds | Its job | | --- | --- | --- | | Core | Digital assets chosen for long-term ownership | Keeps long-term exposure, and can serve as collateral | | Engine | Liquidity positions, normally funded by a loan against the Core | Accumulates units as prices fall, sells inventory as prices rise, and earns trading fees | | Reserve | Stablecoins | Funds purchases during a decline and supports the Engine and the loan | A written Plan connects the Layers. The Plan records the investor's decisions before capital moves: the period it covers, the split between Core and Reserve, the prices to watch, and the response to each one. It sets a limit and a written response for each risk. ## A worked example Illustrative Assume BTC trades at $100,000 and the investor starts with $100,000. The Plan sets a 60:40 Ratio. $60,000 buys 0.6 BTC for the Core, and $40,000 stays in the Reserve as stablecoins. The Flywheel then borrows $12,000 against the Core, an initial LTV of 20%. The Engine places that $12,000 in Accumulation positions from $100,000 down to $64,000. As BTC falls through that range, the positions exchange stablecoins for BTC. At $64,000, the $12,000 has become 0.15 BTC, at an average price of $80,000 before trading costs. The market determines whether and when any of these prices is reached. The [whitepaper's example](https://cryptoflywheel.com/whitepaper/) follows this same portfolio through borrowing, selling, and a full market cycle. ## What the model rests on The model rests on one market thesis: the volatile digital assets it holds will appreciate over the long term and recover from major declines. Its parts are familiar practices from other markets. Property investors borrow against property rather than selling it, some funds keep cash available to buy in a crisis, and market makers earn by buying from sellers and selling to buyers. Decentralized finance provides the tools to combine them in one portfolio. Two [live Flywheels](https://cryptoflywheel.com/f/torque/), Torque and Inertia, run in public. The [timeline](https://cryptoflywheel.com/timeline/) keeps the dated record of how the model developed. ## What can go wrong What can go wrong A Flywheel keeps the price risk of the assets it holds and adds other risks: - **Price:** digital assets can lose most or all of their value, and a target can take years to reach. - **Recovery:** the model assumes its assets recover after major declines. If an asset does not recover, the strategy can fail. - **Borrowing:** a collateralized loan can be liquidated, and interest may exceed what the portfolio earns. - **Liquidity positions:** a position can underperform simply holding the assets it started with. - **Protocols and custody:** a contract, price feed, or stablecoin can fail, and lost keys can make assets inaccessible. - **Behavior:** an emotional decision can override the Plan. The Plan sets a limit and a written response for each risk. It cannot remove them. ## Questions ### Who publishes the Crypto Flywheel™ model? Luminary One publishes it. The Crypto Flywheel™ Whitepaper 1.0 is by Jake Call, Joshua Jagelman, and Konstantin Miunts, and was published in October 2026 under DOI 10.5281/zenodo.23325576. ### Does a Flywheel have to borrow? No. The Engine is normally funded by a loan against the Core, but it can operate without one. Without borrowing, only the Reserve funds the Engine. ### Does the model promise a return? No. The design sets what the portfolio does at each price. The market determines the result, and the model can lose money. Next step Free Crypto Flywheel™ training The model's Layers and rules, explained in order, at no cost. [Start the free training](https://cryptoflywheel.com/get-started/) ## Related - [The three Layers: Core, Engine, and Reserve, and the job each one does](https://cryptoflywheel.com/layers/) Nov 4, 2026 Written by [Jake Call](https://cryptoflywheel.com/learn/authors/jake-call/) Founder, Luminary One Jake Call founded BuildrWealth in February 2023 and Metrix Finance that August. He started out as a DeFi Research Analyst at Debut NZ, a New Zealand managed fund, researching protocols and building portfolios. He is an author of the whitepaper Luminary One published in October 2026. He helps investors replace gut calls with a system where every dollar has a job and every risk has a rule. Reviewed by [Konstantin Miunts](https://cryptoflywheel.com/learn/authors/konstantin-miunts/) Head of Operations, BuildrWealth Konstantin Miunts runs operations at BuildrWealth. He helps architect the strategy and puts it into practice for BuildrWealth's clients. He is an author of the whitepaper Luminary One published in October 2026. Published Nov 4, 2026 ## Sources 1. [The Crypto Flywheel Whitepaper, version 1.0](https://doi.org/10.5281/zenodo.23325576) Education only, not financial advice, and not offered as advice in any country. Digital assets can lose value, including all of it. Crypto Flywheel™ is a trademark of Luminary Assets LLC dba Luminary One. [Published by Luminary One](https://luminary.one/) --- This is the Markdown version of https://cryptoflywheel.com/what-is-the-crypto-flywheel/. The index of every page on this site is https://cryptoflywheel.com/llms.txt.