Bitcoin’s Four-Year Cycle Faces New Influences Beyond Halving, According to Markus Thielen

• Bitcoin’s four-year cycle shifts, now influenced by politics and liquidity.
• Political uncertainty and central bank policies shape Bitcoin’s market movements.
• Institutional caution slows Bitcoin’s growth despite Fed’s recent rate cuts.

Bitcoin’s much-debated four-year market cycle is still at play, but it is no longer being driven solely by Bitcoin’s halving events. Markus Thielen, head of research at 10x Research, shared insights on The Wolf of All Streets Podcast, stating that while the cycle persists, political and liquidity factors now carry more weight than Bitcoin’s supply cuts. According to Thielen, the timing of market peaks aligns more with the broader political environment, including US presidential election cycles, than with Bitcoin’s programmed supply halving.

Thielen highlighted that past market peaks in 2013, 2017, and 2021 all coincided with the fourth quarter. Interestingly, these peaks matched political events, such as US presidential election timelines, more closely than Bitcoin’s halving schedule. The current market environment, shaped by political uncertainty, is pushing investors to reconsider traditional views on the four-year cycle. As Thielen pointed out, the political context, including the expectations of party losses in the upcoming US elections, adds to the uncertainty in the market.

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Impact of US Elections and Central Bank Policies on Bitcoin’s Future

The evolving political landscape has a significant influence on Bitcoin’s performance. Thielen discussed how political uncertainty—specifically around the US elections—affects market sentiment. With expectations of potential shifts in power in Congress, investors may grow cautious, causing them to pull back on their risk appetite. These sentiments could slow down capital inflows, affecting Bitcoin’s price momentum.

Central bank policy also plays a crucial role in shaping the market. Despite the Federal Reserve’s recent rate cuts, which historically would have been bullish for risk assets like Bitcoin, the situation is different now. Institutional investors, who dominate the crypto space, remain more cautious due to mixed signals from the Fed and tightening liquidity conditions. Consequently, Bitcoin’s price has faced challenges in gaining momentum, and it continues to remain in a consolidation phase.

The Shift from Halving to Political and Economic Influences

Thielen’s analysis challenges the traditional narrative that Bitcoin’s four-year cycle is closely tied to its halving events. While halvings have always been important, their influence has diminished as political and economic factors, such as US fiscal policies and monetary decisions, now have a stronger hold over market behavior. The increased involvement of institutional investors further complicates the picture, as they take a more measured approach in the current environment.

With liquidity flowing more slowly into the market and the future unclear due to a mixture of political and central bank actions, Thielen anticipates that Bitcoin will remain in a phase of consolidation. Without a surge in capital inflows, the cryptocurrency may find it difficult to break free from its current range and trigger the next parabolic rally that has defined past cycles.

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