Bitcoin Market Cycles Influenced by Adoption Trends, Analyst Suggests

According to Cointelegraph, Bitcoin's market cycles are not primarily driven by its halving events, as commonly believed. Analyst James Check argues that other factors, such as adoption trends and market structure, play a more significant role in shaping bull and bear cycles. Check contends that Bitcoin has undergone three distinct cycles, none of which are anchored around the halving events, which occur approximately every four years and reduce mining rewards. Check identifies the market's 2017 peak and 2022 bottom as key transition points in these cycles. He describes the first cycle, from 2011 to 2018, as an 'adoption cycle' fueled by early retail adoption. The second, from 2018 to 2022, is termed an 'adolescence cycle,' characterized by a 'Wild West boom and bust with leverage.' The current cycle, beginning in 2022, is labeled a 'maturity cycle,' driven by 'institutional maturity and stability.' Check emphasizes that the 2022 bear market marked a turning point, and those who expect past patterns to repeat may overlook new signals by focusing on historical trends. This perspective challenges the popular belief that Bitcoin's market cycles are tied to its halving events, which create a supply shock by reducing block rewards and increasing demand. Traditionally, bull market peaks have occurred in the year following a halving event, as seen in 2013, 2017, and 2021, with expectations for a similar pattern in 2025. Check also suggests that Bitcoin is 'literally the only other endgame asset alongside gold,' indicating that the current cycle might be prolonged. Recent predictions suggest that the traditional four-year cycle may be ending, with the current bull market potentially extending into next year due to increased institutional participation. Earlier this month, Bitwise's chief investment officer, Matthew Hougan, stated that the cycle is 'not officially over until we see positive returns in 2026,' but he believes the four-year cycle is concluding. Entrepreneur 'TechDev' also noted that understanding Bitcoin's market dynamics requires analyzing business cycle dynamics, highlighting the peaks and troughs of previous cycles. Macroeconomic factors, such as dollar liquidity and ETF inflows, may have contributed to an extended bullish phase. Analysts at Glassnode noted on August 20 that Bitcoin continues to follow its traditional cycle patterns, with recent profit-taking and increased selling pressure indicating a late phase of the cycle. Position trader Bob Loukas offered a pragmatic view, asserting that Bitcoin cycles persist, driven by human behavior and market dynamics, with the only difference being the extent of market impact and recovery speed.