Bitcoin’s Four-Year Cycle Holds Strong: Politics and Liquidity Are Now the Driving Forces
Forget the noise. The four-year heartbeat of Bitcoin hasn't skipped a beat.
Politics and Liquidity: The New Market Makers
The script has flipped. While the halving's supply shock still sets the stage, the real drama now unfolds in the corridors of power and on central bank balance sheets. Regulatory posturing and the ebb and flow of cheap capital are calling the shots, pushing volatility and dictating the pace of the rally. It's a game where macroeconomic tides outweigh minor technical waves.
Institutional adoption isn't just growing—it's morphing. What began as cautious portfolio diversification is accelerating into a structural reshuffle. Major funds aren't just dipping a toe; they're building infrastructure, signaling a long-term bet that's becoming harder for traditional finance to ignore or ridicule.
The Final Word
So the cycle continues, but the drivers have leveled up. Bitcoin's journey is no longer a solo rebellion; it's a complex dance with global fiscal policy and political ambition. It turns out the ultimate disruptor is learning to tango with the very establishment it aimed to bypass—proving once again that in finance, principles are negotiable, but a profitable trend is forever.
Political Shifts and Fed Ambiguity Reshape Bitcoin Market Behavior
A major factor in that trend is political uncertainty. Thielen claimed that one of the biggest fears investors have at times is the possibility of the incumbent president losing seats in Congress. These outcomes decrease the potential of significant policy projects. Markets usually react by reducing risk exposure. The risk asset, Bitcoin, is representative of that change.
He made this statement when the largest cryptocurrency is having difficulties rebounding after the recent rate cut by the Federal Reserve. Reduction in the rate has historically favored the risk assets. According to Thielen, the present environment is not like a previous cycle. Institutional investors now control the crypto markets. Their reactions are more conservative to uncertainty about policy and ambivalent Fed messages.
There are also weakened liquidity conditions. Thielen observed that the inflows of capital into BTC have decelerated compared to last year. Minor inflows decrease the upward pressure. Bitcoin lacks sufficient liquidity for a sustained breakout. Thielen anticipates price convergence over a parabolic rally.
Bitcoin Cycle Timing Evolves Beyond Traditional Four-Year Models
The change alters the way investors think about the timing of the markets. Thielen encouraged traders to break the habit of anchoring expectations on the halving schedules. He explained that political catalysts are increasingly more important.
The trends of US elections, fiscal negotiations, and central bank balance sheets give better indicators. These aspects are getting stronger to define the stages of the market.
Other crypto market operations have presented similar arguments. In October, Arthur Hayes, the co-founder of BitMEX, declared that the classical four-year crypto cycle had concluded. He did not associate the change with declining institutional demand. Hayes argued that traders who were using old timing models were taking a risk to misinterpret the market.
Hayes contended that global liquidity has always been the cause of BTC cycles. The bull markets of the past came to an end once monetary conditions tightened. He points out the times of slow liquidity in the US dollar and Chinese yuan. Hayes claims that the halving has been exaggerated as a causal element. He termed it to be more of a happenstance to wider macro trends.
