CryptoNews

Key takeaways

• 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.

The traditional 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:

• 2012 halving — peak in 2013

• 2016 halving — peak in 2017

• 2020 halving — peak in 2021.

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.

However, as a larger portion of Bitcoin’s fixed 21 million supply is already in circulation, each halving has a progressively smaller relative impact. This raises questions about whether supply shocks alone can continue to dominate the cycle.

Did you know? Since 2009, halvings have occurred in 2012, 2016, 2020 and 2024. Each one permanently lowered Bitcoin’s inflation rate and brought annual issuance closer to zero while reinforcing BTC’s digital scarcity narrative among long-term holders and analysts.

Grayscale’s assessment of Bitcoin cycles

Grayscale has concluded that the current market differs significantly from past cycles in three respects:

Institutional-dominated demand, not retail mania

Previous cycles depended on strong buying from individual investors on retail platforms. Today, capital flows are increasingly driven by exchange-traded funds (ETFs), corporate balance sheets and professional investment funds.

Grayscale observes that institutional vehicles attract patient, long-term capital. This is contrary to the rapid, emotion-driven retail trading seen in 2013 and 2017.

Absence of a rally preceding the drawdown

Bitcoin’s peaks of 2013 and 2017 were marked by extreme, unsustainable price surges followed by collapses. In 2025, Grayscale has pointed out, the price rise has been far more controlled, and the subsequent 30% decline looks like a standard bull-market correction rather than the beginning of a multi-year bear market.

Macro environment that matters more than halvings

In Bitcoin’s earlier years, price movements were largely independent of global economic trends. In 2025, Bitcoin has become sensitive to liquidity conditions, fiscal policy and institutional risk sentiment.

Key influences cited by Grayscale include:

• Anticipated changes in interest rates

• Growing bipartisan support for US crypto legislation

• Bitcoin’s inclusion in diversified institutional portfolios.

These macro factors exert influence independent of the halving schedule.

Did you know? When block rewards are halved, miners receive fewer BTC for the same work. This can prompt miners with higher costs to pause operations temporarily, which often leads to short-term hashrate dips before the network rebalances.

Glassnode data showing a break from classic cycle patterns

Glassnode’s onchain research shows that Bitcoin’s price has made several departures from historical norms:

• Long-term holder supply is at historically high levels: Long-term holders control a larger proportion of the circulating supply than ever before. Continual accumulation limits the amount of Bitcoin available for trading and reduces the supply-shock effect usually associated with halvings.

• Reduced volatility despite drawdowns: Although significant price corrections occurred in late 2025, realized volatility has remained well below the levels seen at previous cycle turning points. It is a sign that the market is handling large moves more efficiently, often due to greater institutional participation.

• ETFs and custodial demand reshape supply distribution: Onchain data shows growing transfers into custody wallets tied to ETFs and institutional products. Coins held in these wallets tend to remain dormant, reducing the amount of Bitcoin that actively circulates in the market.

A more flexible, macro-linked Bitcoin cycle

According to Grayscale, Bitcoin’s price behavior is gradually detaching from the four-year model and becoming more responsive to:

• Steady long-term institutional capital

• Improving regulatory environments

• Global macroeconomic liquidity

• Sustained ETF-related demand

• An expanding group of committed long-term holders.

Grayscale stresses that corrections remain inevitable and can still be severe. However, they do not automatically signal the onset of a prolonged bear market.

Did you know? After each halving, Bitcoin’s inflation rate drops sharply. Following the 2024 halving, annual supply inflation fell below many major fiat currencies and strengthened its comparison to scarce commodities like gold.

Why some analysts still believe in halving patterns

Certain analysts, often citing Glassnode’s historical cycle overlays, continue to believe that halvings remain the primary driver. They argue that:

• The halving is still a fundamental and irreversible supply cut.

• Long-term holder activity continues to cluster around halving periods.

• Retail-driven activity could still reappear even as institutional participation grows.

These differing views show that the discussion is far from settled. Arguments and counterarguments about Bitcoin’s ignoring the four-year cycle reflect an evolving market.

An evolving framework for understanding Bitcoin 

Grayscale’s case against the dominance of the traditional four-year cycle rests on clear structural shifts. These include rising institutional involvement, deeper integration with global macro conditions and lasting changes in supply dynamics. Supporting data from Glassnode and Coinbase Institutional confirm that today’s Bitcoin market operates under more sophisticated 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 are focusing on onchain metrics, liquidity trends and institutional flow indicators. This more refined approach better captures Bitcoin’s ongoing transformation from a fringe digital asset into a recognized part of the global financial landscape.