Key insights
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The halving-driven Bitcoin price pattern that characterised Bitcoin's early history is losing steam. The more BTC comes into circulation, the smaller the relative impact of every halving.
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According to Grayscale, today's Bitcoin market is more driven by institutional capital than the retail speculation that characterised previous cycles.
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Unlike the explosive rallies of 2013 and 2017, Bitcoin's recent price rise has been more controlled. Grayscale notes that the following 30% decline is comparable to a typical bull market correction.
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Interest rate expectations, the bipartisan dynamics of US crypto regulation and the combination of Bitcoin into institutional portfolios are increasingly shaping market behavior.
Since its inception, the worth of Bitcoin (BTC) has followed a predictable pattern. A programmed event halves the availability of Bitcoin and creates scarcity. This was often followed by periods of strong price increases and later corrections. The repeating sequence, commonly often called the four-year cycle, has greatly influenced investor expectations since Bitcoin's early days.
A recent evaluation from Grayscale, supported by on-chain data from Glassnode and market structure insights from Coinbase Institutional, takes a special view of Bitcoin's price history. This suggests that Bitcoin price motion may move beyond this traditional model within the mid-2020s. Bitcoin's price movements look like increasingly influenced by aspects akin to institutional demand and general economic conditions.
This article examines Grayscale's view that the four-year cycle is losing its ability to totally explain price movements. It's about Grayscale's evaluation of Bitcoin cycles, supporting evidence from Glassnode, and why some analysts imagine Bitcoin will proceed to follow the four-year cycle.
The traditional four-year cycle
Bitcoin halvings, which occur roughly every 4 years, reduce the issuance of recent BTC by 50%. Historically, these supply reductions have at all times preceded major bull markets:
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Halving 2012 – Peak 2013
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Halving 2016 – Peak 2017
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Halving 2020 – Peak 2021.
The pattern arose from each the built-in scarcity mechanism and investor psychology. Retail was the fundamental driver of demand and reduced supply led to strong buying.
However, with more of the fixed Bitcoin supply of 21 million already in circulation, each halving has an increasingly smaller relative impact. This raises the query of whether supply shocks alone can proceed to dominate the cycle.
Did you understand? Since 2009, halvings have occurred in 2012, 2016, 2020 and 2024. Each of those halvings permanently lowered Bitcoin's inflation rate and brought annual issuance closer to zero, while reinforcing BTC's digital scarcity narrative amongst long-term holders and analysts.
Grayscale's assessment of Bitcoin cycles
Grayscale has concluded that the present market differs significantly from previous cycles in 3 ways:
Institutional dominated demand, not retail madness
Previous cycles have relied on heavy buying by individual investors on retail platforms. Today, capital flows are increasingly driven by exchange-traded funds (ETFs), corporate balance sheets and skilled investment funds.
Grayscale observes that institutional vehicles attract patient, long-term capital. This contrasts with the fast-paced, emotion-filled retail trading of 2013 and 2017.
No rally before the drawdown
Bitcoin's peaks in 2013 and 2017 were characterised by extreme, unsustainable price increases and subsequent declines. In 2025, Grayscale said, the worth increase was way more controlled, and the following 30% decline appeared more like a traditional bull market correction than the beginning of a multi-year bear market.
Macro environment that’s more necessary than halvings
In Bitcoin's earlier years, price movements were largely independent of world economic developments. In 2025, Bitcoin has turn into sensitive to liquidity conditions, financial policies and institutional risk sentiment.
Key influences cited by Grayscale include:
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Expected changes in rates of interest
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Growing bipartisan support for US crypto laws
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The inclusion of Bitcoin in diversified institutional portfolios.
These macro aspects exert influence whatever the halving schedule.
Did you understand? If block rewards are halved, miners will receive less BTC for a similar work. This may cause higher-cost miners to temporarily suspend operations, often resulting in short-term dips within the hash rate before the network returns to equilibrium.
Glassnode data shows a break with classic cycle patterns
Glassnode's on-chain research shows that Bitcoin's price has deviated from historical norms on several occasions:
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The supply of long-term holders is at a historically high level: Long-term holders control a greater share of circulating supply than ever before. Continuous accumulation limits the quantity of Bitcoin available for trading and reduces the availability shock effect that typically accompanies halvings.
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Reduced volatility despite drawdowns: Although there have been significant price corrections at the top of 2025, realized volatility remained well below the degrees of previous cycle turning points. This is an indication that the market is handling large moves more efficiently, often as a result of greater institutional participation.
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ETFs and portfolio demand change the availability distribution: On-chain data shows growing transfers into portfolios tied to ETFs and institutional products. The coins held in these wallets typically remain inactive, reducing the quantity of Bitcoin actively circulating out there.
A more flexible, macro-linked Bitcoin cycle
According to Grayscale, Bitcoin price behavior is progressively moving away from the four-year model and becoming more aware of the next:
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Stable, long-term institutional capital
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Improving the regulatory environment
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Global macroeconomic liquidity
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Continued ETF demand
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A growing group of committed long-term owners.
Grayscale emphasizes that corrections remain inevitable and may still be serious. However, they don’t robotically signal the beginning of a sustained bear market.
Did you understand? After each halving, Bitcoin's inflation rate drops sharply. Following the halving in 2024, annual supply inflation fell below that of many major fiat currencies, increasing their comparison to scarce commodities akin to gold.
Why some analysts still imagine in halving patterns
Certain analysts, who often cite Glassnode's historical cycle overlays, proceed to imagine that halvings remain the fundamental driver. They argue that:
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The halving continues to be a fundamental and irreversible supply cut.
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Long-term holder activity continues to be concentrated around halving periods.
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Even if institutional participation increases, there could still be retail-driven activity.
These different views show that the discussion is much from settled. Arguments and counterarguments about Bitcoin ignoring the four-year cycle reflect an evolving market.
An evolving framework for understanding Bitcoin
Grayscale's argument against the dominance of the standard four-year cycle rests on clear structural changes. These include increasing institutional participation, greater integration into global macro conditions and lasting changes in supply dynamics. Supportive data from Glassnode and Coinbase Institutional confirms that today's Bitcoin market is subject to more complex forces than the retail-dominated cycles of the past.
As a result, analysts are placing less emphasis on fixed halving-based timing models. Instead, they deal with on-chain metrics, liquidity trends, and institutional flow indicators. This refined approach higher captures Bitcoin's ongoing transformation from a marginal digital asset to a recognized a part of the worldwide financial landscape.
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