Why Grayscale Thinks Bitcoin Will Ignore The 4-year Cycle This Time

Grayscale argues Bitcoin’s market structure has evolved beyond the old four-year rhythm. Institutional flows and macro dynamics have reshaped BTC’s price behavior.

The halving-driven Bitcoin pricing pattern that shaped Bitcoin’s early history is losing power. As more BTC enters circulation, each halving has a smaller relative impact.

According to Grayscale, today’s Bitcoin market is shaped more by institutional capital than the retail speculation that defined earlier cycles.

Unlike the explosive rallies of 2013 and 2017, Bitcoin’s recent price rise has been more controlled. Grayscale notes that the subsequent 30% drop resembles a typical bull-market correction.

Interest-rate expectations, bipartisan US crypto regulatory momentum and Bitcoin’s integration into institutional portfolios increasingly shape market behavior.

Since it came into being, Bitcoin’s (BTC) price has followed a predictable pattern. A programmed event cuts the supply of Bitcoin in half and creates scarcity. This has often been followed by periods of sharp price increases and later corrections. The repeating sequence, widely known as the four-year cycle, has strongly influenced investor expectations since Bitcoin’s earliest days.

Recent analysis from Grayscale, backed by onchain data from Glassnode and market-structure insights from Coinbase Institutional, takes a different view of Bitcoin’s price path. It indicates that Bitcoin’s price action in the mid-2020s may be moving beyond this traditional model. Bitcoin’s price movements appear increasingly influenced by factors such as institutional demand and broader economic conditions.

This article explores Grayscale’s view that the four-year cycle framework is losing its ability to fully explain price movements. It discusses Grayscale’s analysis of Bitcoin cycles, supporting evidence from Glassnode, and why some analysts believe Bitcoin will still follow the four-year cycle.

Bitcoin halvings, which take place approximately every four years, reduce the issuance of new BTC by 50%. In the past, these supply reductions have consistently preceded major bull markets:

The pattern arose from both the built-in scarcity mechanism and investor psychology. Retail traders were the primary drivers of demand, and the reduced supply led to strong buying.

Source: CoinTelegraph