The Four-Year Cycles of Cryptocurrency: Understanding the Market Dynamics | by Mallikarjun Pasupuleti | The Capital | Jan, 2025
Cryptocurrency markets have gained immense popularity over the past decade, attracting investors, developers, and enthusiasts alike. While the market’s volatility often grabs headlines, a deeper analysis reveals a fascinating pattern: the four-year cycles. Understanding these cycles can provide valuable insights into the market’s behavior and help investors make informed decisions.
What Are Cryptocurrency Four-Year Cycles?
The concept of four-year cycles in cryptocurrency primarily stems from Bitcoin, the first and most influential cryptocurrency. These cycles are closely tied to Bitcoin’s halving events, which occur approximately every four years. During a halving event, the reward for mining new Bitcoin blocks is reduced by half, effectively decreasing the rate at which new Bitcoin is introduced into circulation.
The Phases of the Four-Year Cycle
Each four-year cycle can be divided into four distinct phases:
- Accumulation Phase
- This phase typically follows a market crash or a prolonged bear market.
- Prices stabilize at lower levels, and long-term investors begin accumulating assets.
