A New Perspective on the Four-Year Crypto Cycle: I Asked Seven Veteran Practitioners What Stage Were We At Now?

Original article | Odaily Planet Daily ( @OdailyChina )

Author | Dingdang ( @XiaMiPP )

In the eighteen years following Bitcoin's birth, the "four-year cycle" theory became almost the cornerstone of belief in the cryptocurrency market. Bitcoin halvings, supply contraction, price increases, and altcoin seasons—this narrative not only explains multiple bull and bear market cycles in history but also profoundly influences investors' position management, project fundraising pace, and even the entire industry's understanding of "time."

However, after the halving in April 2024, Bitcoin only rose from $60,000 to its all-time high of $126,000, a much smaller increase than in previous halvings. Altcoins were even weaker, and macro liquidity and policy variables became more sensitive anchors for the market. Especially after the large-scale entry of spot ETFs, institutional funds, and traditional financial instruments, one question has been repeatedly discussed:

Does the four-year cycle still hold true in the crypto market?

To this end, we specially invited seven senior practitioners in the crypto field to conduct a dialogue that transcended optimism and caution, and bull and bear market predictions. They are:

• Jason | Founder of NDV Fund: Previously responsible for China investments in the family office of Alibaba founder Joe Tsai, involved in both primary and secondary markets. His investment style combines the rigor of the primary market with the liquidity of the secondary market. His first fund achieved an absolute return of approximately 275% within 23 months, has been fully exited, and as an open-ended fund, it ensured that all investors made a profit.
• Ye Su | Founding Partner of ArkStream Capital: Over the past eight years, he has invested in more than 100 companies and projects, including Aave, Filecoin, and Ethena, and is a trend-following institutional investor.
• Jack Yi | Founder of Liquid Capital: Focusing on real-money positions and trading strategies, he emphasizes the allocation value of mainstream assets, stablecoins, and the exchange ecosystem at different stages of the cycle.
• James | Founder of DFG: Currently manages over $1 billion in assets. He was an early investor in companies such as LedgerX, Ledger, Coinlist, and Circle, and is also an early investor and supporter of protocols such as Bitcoin, Ethereum, Solana, and Uniswap.
• Joanna Liang | Founding Partner of Jsquare Fund: A post-90s entrepreneur and investor, currently managing over $200 million in assets and operating a dedicated $50 million LP fund; she has invested in several high-profile projects including Pudgy Penguins, Circle, Amber Group, and Render Network.
• Bruce | Founder of MSX: With a background in the mining industry, he assesses the long-term profitability and risk boundaries of the crypto market based on mining costs, cyclical returns, and industry maturity.
• CryptoPainter | Crypto Data Analyst: Using on-chain data and technical indicators as the main tools, combined with historical cycle characteristics, to quantitatively judge market stages and trend inflection points.

1. What exactly is this "four-year cycle" we are talking about?

Before discussing whether the cycle has "failed," we first need to clarify a premise:

What exactly does the "four-year cycle" we're talking about refer to?

According to the general consensus among the interviewees, the traditional four-year cycle is mainly driven by the Bitcoin block reward halving, which occurs approximately every four years. Halving means a decrease in new supply, changes in miner behavior, and provides long-term support for the price center. This is the core and most mathematically grounded part of the "four-year cycle" narrative.

However, some guests incorporated the crypto cycle into a broader financial framework. Jason, founder of NDV, believes that the four-year cycle is actually a dual-driven model of political and liquidity cycles , rather than simply a halving code pattern. The so-called four years highly overlap with the US election cycle and the pace of liquidity release by global central banks. Previously, people only looked at halving, considering it the only variable, because the number of new Bitcoins added in each cycle was previously very large. But now, with the approval of spot ETFs, Bitcoin has entered the macro asset category. The expansion speed of the Federal Reserve's balance sheet and the growth of global M2 are the true core defining factors of the cycle. Therefore, the four-year cycle in his view is essentially a cycle of fiat currency liquidity. Simply considering the supply-side impact mathematically, this BTC cycle (2024-2028) will only add 600,000 coins, which is too small for the existing issuance of around 19 million. The additional selling pressure of less than $60 billion will also be easily absorbed by Wall Street.

II. Regularity, or a self-fulfilling narrative?

When a concept is repeatedly validated and widely disseminated, it often evolves from a "rule" into a "consensus," and further into a narrative. This narrative, in turn, influences market behavior. Therefore, an unavoidable question is: is the four-year cycle an objectively existing economic law, or a market narrative that is collectively believed and thus continuously self-fulfilling?

Regarding the causes of the four-year cycle, our interviewees generally agreed that it is the result of the combined effect of objective mechanisms and market narratives, but different dominant forces emerge at different stages.

As CryptoPainter points out, the four-year cycle was indeed significant in the early days when miners produced a lot of gold. However, this cycle of supply and demand changes has a clear marginal effect. Theoretically, with each halving, the impact of the supply and demand changes brought about by the halving event itself is also halved. Therefore, the percentage increase in each bull market also shows a logarithmic reduction. It can be predicted that the next halving cycle will have a smaller price impact. Jason also points out that as the market size increases, the impact of simple supply-side changes is decreasing. The current cycle is more based on the self-fulfilling prophecy of liquidity.

Joanna Liang, founding partner of Jsquare Fund, added from a market behavior perspective that the four-year cycle is largely self-fulfilling. As the structure of institutional and retail investor participation changes, the relative importance of macroeconomic policies, regulatory environment, liquidity conditions, and halving events is reordered with each cycle. In this dynamic game, the four-year cycle is no longer an "ironclad rule," but merely one of many influencing factors. In her view, precisely because the fundamentals are constantly evolving, it is not impossible for the market to break the four-year cycle pattern or even surge into a "supercycle."

Overall, the consensus among the guests was that while the four-year cycle did have a solid supply and demand foundation in its early stages, as miners' influence in the market declined and Bitcoin gradually shifted towards asset allocation, the cycle is transitioning from being driven by strong mechanisms to being the result of a combination of narratives, behaviors, and macroeconomic factors. The current cycle may have gradually shifted from being driven by "hard constraints" to being driven by "soft expectations."

Third, the gains in this round have slowed significantly. Is this a natural decline in the cycle, or has it been "overshadowed" by the power of ETFs and institutional funds?

Regarding this issue, almost all the guests gave a relatively consistent directional judgment: this is a natural result of diminishing marginal returns , rather than a sudden failure of the cycle. Any growth market will experience a process of diminishing returns. As Bitcoin's market capitalization continues to expand, each new "multiple" requires an exponential increase in capital inflows, so a decline in returns is itself a natural law.

From this perspective, the fact that "the increase is not as much as before" is actually a result that aligns with long-term logic.

But the deeper changes come from the market structure itself.

Joanna Liang believes the biggest difference between this cycle and previous ones lies in the early entry of spot ETFs and institutional funds. In the previous cycle, Bitcoin's record high was mainly driven by marginal liquidity from retail investors; in this cycle, over $50 billion in ETF funds flowed in continuously before and after the halving, absorbing the supply shock before it truly materialized. This spread the price increase over a longer time horizon, rather than concentrating on a parabolic surge after the halving.

Jack Yi further added from the perspective of market capitalization and volatility that as Bitcoin reaches the trillion-dollar level, the decrease in volatility is an inevitable result of its mainstream assetization. In the early stages when the market capitalization was smaller, capital inflows could easily lead to exponential growth; however, at its current size, even doubling would require an extremely large amount of new capital.

James, founder of DFG, views the halving as a "variable that still exists but is becoming less important." In his view, future halvings will be more like secondary catalysts , and what will truly determine the trend will be the flow of institutional funds, the realization of real needs such as RWA, and the macro liquidity environment.

However, Bruce, founder of MSX, doesn't entirely agree. He believes that halving increases the production cost of Bitcoin, and that cost will ultimately remain a long-term constraint on price. Even as the industry matures and overall returns decline, halving will still have a positive impact on price through increased costs, just not in the form of dramatic price fluctuations.

In summary, the guests did not believe that the "smaller gains" were caused by a single factor. A more reasonable explanation is that the marginal impact of the halving is decreasing, while ETFs and institutional funds are changing the rhythm and pattern of price formation. This does not mean the halving has failed, but rather that the market is no longer focused on a single point of explosive growth centered around the halving.

Fourth, what stage are we currently in?

If the previous discussion focused more on whether the cyclical structure still holds true, then this question is obviously more relevant: From the current perspective, are we in a bull market, a bear market, or some kind of transitional phase that has not yet been accurately named?

It is precisely on this point that the interviewees had the most obvious disagreements.

MSX founder Bruce is rather pessimistic, believing we are currently in the early stages of a typical bear market, though the end of the bull market is not widely acknowledged by most participants. His judgment is based on the fundamental cost-return structure . In the previous cycle, Bitcoin mining costs were around $20,000, with the price peaking at $69,000, resulting in a profit margin for miners approaching 70%. In this cycle, however, the post-halving mining cost is close to $70,000, and even with the price reaching an all-time high of $126,000, the profit margin is only slightly over 40%. Bruce believes that in an industry that has been around for nearly 20 years, declining returns in each cycle are normal. Unlike 2020-2021, this cycle has seen a significant influx of new capital flowing into AI-related assets rather than the crypto market. At least in the North American market, the most active risk-averse funds remain concentrated in the AI sector of US stocks.

CryptoPainter's assessment is clearly biased towards technical and data-driven perspectives. He believes the current market hasn't entered a true cyclical bear market, but is already in a technical bear market—its key indicator being a weekly break below the 50-week moving average (MA50). The past two bull markets both experienced technical bear markets later on, but this doesn't necessarily mean the cycle has ended immediately. A true cyclical bear market often requires a synchronized recession in the macroeconomy as confirmation. Therefore, he describes the current phase as a "probationary period": the technical structure has weakened, but macroeconomic conditions haven't yet provided a final verdict. He specifically mentions that the total supply of stablecoins is still growing, and when stablecoins also stop growing for an extended period (more than two months), the bear market will be confirmed.

In contrast, many guests still lean towards the view that the cycle has become ineffective, and the market is currently in a mid-to-late stage of a bull market correction, with a high probability of entering a period of fluctuating upward movement or a slow bull market. Jason and Ye Su's judgments are both based on global macro liquidity. In their view, the US currently has almost no other options but to delay the concentrated release of debt pressure through monetary easing. The interest rate cut cycle has only just begun, and the liquidity "tap" has not been turned off. Therefore, as long as global M2 continues to expand, crypto assets, as the most liquidity-sensitive sponge, will not end their upward trend. Furthermore, they mentioned that a true bear market signal is when central banks begin to substantially tighten liquidity, or when a severe recession in the real economy leads to a liquidity crunch. Currently, these indicators do not show any abnormalities; on the contrary, they indicate that liquidity is poised to be released. Moreover, from the perspective of market leverage, if the open interest relative to market capitalization is too high, it is usually a signal of a short-term correction, but not a bear market signal.

Jack Yi also believes that Wall Street and institutions are reconstructing the financial system based on blockchain, making the asset structure more and more stable. It is no longer as prone to large fluctuations as it was in the early days when retail investors dominated the market. Moreover, with the change of the Federal Reserve Chairman, the arrival of the interest rate cut cycle, and the most favorable crypto policy in history, the current fluctuations will be considered as wide-range fluctuations in the future, and the medium to long term is a bull market.

The disagreements themselves are perhaps the most authentic characteristic of this stage. The judgments of our interviewees constitute a small, albeit imperfect, sample: some have confirmed a bear market, while others are waiting for the data to provide the final answer, but many more likely believe that the four-year cycle theory has essentially become invalid.

More importantly, it is no longer the sole, or even the primary, framework for understanding the market. The importance of halving, timing, and sentiment is being reassessed, while macro liquidity, market structure, and asset attributes are becoming more critical variables.

V. The Core Driver of the Perpetual Bull Market: From Sentiment-Driven Bull to Structural Bull

If the "four-year cycle" is weakening, and the future crypto market no longer shows a clear bull-bear cycle, but instead enters a state of long-term oscillating upward movement with significantly compressed bear markets, then where does the core driving force supporting this structure come from?

Jason believes the rise of Bitcoin is driven by a systemic decline in fiat currency credibility and the normalization of institutional allocation . As Bitcoin is increasingly seen as "digital gold" and enters the balance sheets of sovereign nations, pension funds, and hedge funds, its upward trend will no longer rely on single cyclical events but will be closer to that of gold, a "long-term asset that hedges against fiat currency devaluation." Its price performance will then exhibit a spiral upward trend. At the same time, he particularly emphasizes the importance of stablecoins . In his view, compared to Bitcoin, stablecoins have a larger potential user base, and their penetration path is closer to the real economy. From payments and settlements to cross-border capital flows, stablecoins are becoming the "interface layer" of the next generation of financial infrastructure. This means that the future growth of the crypto market will not entirely depend on speculative demand but will gradually embed itself into real financial and commercial activities.

Joanna Liang's assessment echoes this view. She believes that a key variable in the future slow bull market comes from continued institutional adoption , whether through spot ETFs or the tokenization path of RWA. As long as institutional allocation continues, the market will exhibit a "compound interest" upward structure—volatility will be smoothed out, but the trend will not reverse.

CryptoPainter's perspective is more direct. He points out that the BTCUSD trading pair is on the right side, which is USD. Therefore, as long as global liquidity remains loose in the long term and the US dollar is in a weak cycle, asset prices will not experience a deep bear market. Instead, they will slowly oscillate upwards in successive technical bear markets. The traditional bull-bear structure will also shift to a pattern similar to gold, characterized by "long-term oscillation - rise - long-term oscillation".

Of course, not everyone agrees with the "slow bull narrative".

Bruce's outlook is clearly pessimistic. He believes that the structural problems of the global economy remain unresolved: a deteriorating job market, young people becoming complacent, high concentration of wealth, and persistent geopolitical risks. Against this backdrop, the probability of a severe economic crisis in 2026–2027 is not low. If systemic macroeconomic risks do indeed erupt, crypto assets will likely be unable to escape unscathed.

To some extent, a slow bull market is not a consensus, but a conditional judgment based on continued liquidity .

VI. Is there still a "Shanzhai Season" in the traditional sense?

The "copycat season" is almost an integral part of the four-year cycle narrative. However, its absence in this cycle has become one of the most frequently discussed phenomena.

The poor performance of altcoins in this cycle is due to several factors. Joanna points out that firstly, Bitcoin's rising dominance has created a "safe haven" environment within risky assets, making institutional funds more inclined to choose blue-chip assets. Secondly, the maturing regulatory framework makes altcoins with clear utility and compliance more conducive to long-term adoption. Thirdly, this cycle lacks a killer app and a clear narrative like DeFi and NFTs in the previous cycle.

Another point of consensus among the guests was that a new altcoin season may emerge, but it will be more selective, focusing only on a few tokens that have real use cases and can generate revenue.

CryptoPainter elaborated on the issue more thoroughly. He argued that a traditional altcoin boom is unlikely to recur. The term "traditional" implies that the total number of altcoins was within a reasonable range, but currently, the total number of altcoins has reached unprecedented and continuously new highs. Even with the influx of macro liquidity, the limited supply will prevent a broad-based price surge. Therefore, even if an altcoin boom occurs, it will be extremely rare and localized, driven by sector-specific narratives. Focusing on individual altcoins is meaningless at this point; the focus should be on the underlying sectors and industries.

Ye Su used the US stock market as an analogy: the future performance of altcoins will be more like the M7 in the US stock market—blue-chip altcoins will outperform the market in the long run, while small-cap altcoins will occasionally have a breakout, but the sustainability is extremely weak.

Ultimately, the market structure has changed. It used to be an attention economy driven by retail investors; now it's an economic model driven by institutional investors and financial statements.

VII. Position Distribution

In a market with a blurred cyclical structure and fragmented narratives, we also consulted several guests about their actual position distribution.

A striking fact is that most respondents have essentially liquidated their altcoin holdings, and most are only holding half of their holdings.

Jason's portfolio strategy clearly leans towards a "defensive + long-term" approach. He stated that he currently prefers to use gold instead of the US dollar as a cash management tool to hedge against fiat currency risks. Regarding digital assets, he allocates the majority of his holdings to BTC and ETH, but remains cautious with his ETH holdings. They prefer assets with high certainty, namely hard currency (BTC) and exchange equity (Upbit).

CryptoPainter strictly adheres to the rule of "cash accounting for no less than 50%", with its core holdings remaining BTC and ETH, and altcoin positions below 10%. It exited all gold positions after reaching $3500 and has no immediate plans to allocate to gold. Meanwhile, it has placed some short positions with very low leverage on US AI stocks with significant valuation bubbles.

Jack Yi has a relatively high risk appetite, and his fund is nearly fully invested, but its structure is also concentrated: ETH is the core, with a stablecoin-based portfolio (WLFI) and supplemented by large-cap assets such as BTC, BCH, and BNB. The strategy is not based on cyclical speculation, but rather on a long-term bet on public blockchains, stablecoins, and exchanges.

In stark contrast is Bruce. He has almost completely liquidated his crypto holdings, including selling BTC around $110,000. He believes there will still be opportunities to buy back below $70,000 within the next two years. His US stock holdings are currently mostly defensive/cyclical stocks, and he expects to liquidate most of his US stock portfolio before next year's World Cup.

8. Is now a good time to buy at the bottom?

This is the most actionable of all the questions. Bruce's attitude is rather pessimistic; he believes we are far from the bottom. The true bottom will appear when "no one dares to buy at the bottom anymore."

CryptoPainter, a cautious firm, also believes the ideal price for bottom-fishing or starting dollar-cost averaging is below $60,000. The logic is simple: buying gradually after the price has halved from its peak has proven successful in every bull market. Clearly, this target won't be reached in the short term. Their view on the current market is that after a period of large-scale fluctuations in 1-2 months, there's a possibility of testing the $100,000+ level again next year, but it's unlikely to reach a new high. Subsequently, the positive effects of macroeconomic monetary policy will have been exhausted, and the market will lack follow-up liquidity and new narratives, officially entering a bear market cycle. Then, one can patiently wait for monetary policy to initiate a new round of easing and aggressive interest rate cuts.

Most of the guests held a more neutral stance. They believed that now might not be the time for "aggressive bottom-fishing," but rather a window of opportunity to begin building positions in batches and gradually allocating capital . The consensus was singular: avoid leverage, avoid frequent trading, and discipline is far more important than judgment.