Bitcoin Signals a Shift: Breaking the Four-Year Market Cycle

Bitcoin, the foremost cryptocurrency, has recently experienced its first "red candle" after a halving year, marking a historic moment in its market trends.

Key Takeaways

Bitcoin has recorded its first red candle following a halving, indicating a significant break from its historical market behavior.
Traditionally, Bitcoin's four-year cycle featured explosive growth in the year after halving, but this cycle appears to be different.
The rise of cryptocurrencies into mainstream investment channels, like ETFs, has contributed to Bitcoin's reduced volatility.
In 2025, Bitcoin deviated from its historical trend, failing to maintain its usual three years of bullish growth following a bear market.

Bitcoin Signals a Shift: Breaking the Four-Year Market Cycle

This article explores Bitcoin's recent market activity, indicating a significant change in its traditional four-year cycle. As the cryptocurrency fails to show the expected post-halving supply shock, it highlights the evolving role of Bitcoin as a "macro asset" influenced by institutional investments and the introduction of ETFs.

Bitcoin’s Changing Market Dynamics

Bitcoin has recently marked a pivotal moment by registering its first decline after a halving year, which suggests that the cryptocurrency’s traditional four-year market cycle is coming to an end. The notable absence of a post-halving supply shock signals a departure from previous trends.

Understanding the Four-Year Cycle Theory

Historically, Bitcoin has demonstrated substantial price rallies in the years immediately following halvings, which occurred in 2013, 2017, and 2021. The theory posited that these events led to a supply shock, resulting in price surges within 12 to 18 months.

Analyzing the current situation, we observe a trend of diminishing returns; each successive rally appears less pronounced than the last. The new dynamics, including the introduction of exchange-traded funds (ETFs) and greater institutional involvement, have transformed Bitcoin into a macro asset characterized by lower volatility. It is no longer perceived merely as a speculative high-growth investment.

Early Predictions for 2025 Cycle

The "break" in the expected cycle for 2025 was anticipated as early as 2024. This cycle was notably distinct because Bitcoin reached an all-time high (ATH) in March 2024, approximately one month before the anticipated halving occurred. In previous cycles, ATHs typically emerged 12 to 18 months after halving events.

The early launch of spot ETFs is believed to have driven this shift significantly, as it absorbed most of the liquidity in the market. By the time 2025 arrived, the expected influx of institutional capital had already been deployed during 2024, altering the market landscape.

The End of Historical Norms

Traditionally, Bitcoin's market performance followed a clear pattern of "one bear year followed by three bull years." However, data indicates that 2025 has disrupted this sequence. It represents the first instance since the 2014 bear market where Bitcoin did not conclude a series of three consecutive green candles.

Additionally, Bitcoin has wrapped up a year with a price change of less than 10% for the first time, reinforcing the notion that its notorious volatility is waning. This development could suggest a new phase for Bitcoin as it continues to adapt within a changing investment landscape.