Blindly believing that the four-year cycle will mechanically repeat itself is unwise.
Written by: Matt Hougan, Chief Investment Officer of Bitwise
Translated by: Luffy, Foresight News
In the past few weeks, during meetings with institutional investors, the most frequently asked question has been: Does the four-year cycle of Bitcoin still hold relevance?
The so-called four-year cycle refers to the historical pattern of Bitcoin showing "three years of growth followed by a year of decline."
This question is crucial because, according to the logic of the four-year cycle, next year will be a difficult year for Bitcoin and the entire cryptocurrency market.
While I cannot accurately predict the price movements of cryptocurrencies next year, I believe that blindly believing that the four-year cycle will mechanically repeat itself is unwise. After all, the four-year cycle is not a sacred law etched in stone by the gods of cryptocurrency; its formation actually stems from three specific driving factors:
Bitcoin halving events: The mining rewards on the Bitcoin blockchain are halved every four years.
Interest rate fluctuations: The two interest rate spikes in 2018 and 2022 both served as catalysts for corrections in the cryptocurrency market.
Volatile market cycles: The years of significant declines in cryptocurrency (2014, 2018, 2022) have invariably followed strong years of growth. For example, Bitcoin rose by 5530% in 2013, 1349% in 2017, and 57% in 2021. During market euphoria, fraud and speculative bubbles proliferate, and the bursting of these bubbles, such as the regulatory crackdown on ICOs in 2018 and the collapse of the FTX exchange in 2022, directly triggered market crashes that year.
Today, these three driving factors have either significantly weakened in influence or are moving in a direction completely opposite to previous cycles. The impact of Bitcoin halving is not as strong as it was four years ago; interest rates are likely to decline rather than rise in 2026; and the cryptocurrency market in 2025 has not exhibited the kind of frenzied growth seen in previous cycles.
At the same time, more decisive forces, particularly the large-scale entry of institutional investors and the gradual improvement of regulatory policies, are gearing up for 2026. In our latest report, "Market Predictions for 2026," we predict that Bitcoin will reach a new all-time high next year. I still believe this is the most likely outcome.
What will replace the four-year cycle?
If the four-year cycle has indeed come to an end, a reasonable question arises: What new framework should we establish for the cryptocurrency market in 2026 and beyond?
The four-year cycle once provided clear guidance for investors. Understanding whether we are currently in a market recovery, a bull market, or a cryptocurrency winter can help investors hold firm during bear markets and remain rational during bull markets.
So, what framework can replace it today?
The answer is: a decade-long protracted struggle.
I know this phrase sounds far less eye-catching than the four-year cycle. But please hear me out, as I firmly believe this is the essence of the current market.
A protracted struggle refers to the long-term contest between two forces: one is a strong, enduring, and gradual positive driving force; the other is an intermittent, aggressive, but ultimately insufficient negative shock.
The positive driving forces currently gaining momentum include: the accelerated positioning of institutional investors, the continuous improvement of regulatory frameworks, concerns about the devaluation of fiat currencies, and the realization of practical applications such as stablecoins and asset tokenization.
The goal of these trends is to disrupt entrenched traditional systems such as capital markets, global payment systems, and international monetary systems, which will take over a decade to fully materialize. Early signs of this process are already visible: billions of dollars are flowing into cryptocurrency ETFs, cryptocurrency-related legislation is steadily advancing in Congress, and the market size of stablecoins and tokenization is rapidly expanding, among others.
However, progress will inevitably encounter resistance. Possible negative shocks include: macroeconomic shocks, a wave of leveraged fund liquidations, and malicious events such as hacking, fraud, and exit scams. The impact cycle of such negative shocks typically spans weeks, months, or quarters.
Overall, the long-term influence of positive driving forces far exceeds that of negative shocks, but the speed of negative shocks can be very rapid, potentially suppressing positive forces in the short term. The market crash on October 10, 2025, is a typical example: a macro shock triggered a massive liquidation of cryptocurrency leveraged positions, directly leading to a cliff-like market decline.
It is this pattern of a protracted struggle that has created a severe divide in the current cryptocurrency market: retail investors are in deep despair, while many institutional investors are filled with bullish confidence. The root of this divide lies in the different time dimensions that each group focuses on. Retail investors are concerned about the aftermath of the October liquidation event; while institutions are looking forward to a scenario where the market size of stablecoin assets surpasses $3 trillion by 2030.
Both viewpoints have their validity, but they are based on different time scales.
The significance of the protracted struggle for investors
In the past few months, I have been using the framework of a "protracted struggle" to analyze the market, and this approach has proven to be highly valuable. The protracted struggle pattern suggests that the market will exhibit the following characteristics:
In the long term, returns will be substantial but not excessively exaggerated.
Overall volatility will decrease.
Periodic corrections of 20% to 40% will occur.
This means that investors must take every market correction seriously, as they may last for quite a long time. However, as long as the fundamentals remain strong, one can be confident that prices will eventually rebound.
Looking back, I believe the cryptocurrency market officially entered the protracted struggle phase when the Bitcoin spot ETF was approved in January 2024. This milestone event initiated a wave of institutional investment, and I believe this trend will continue for a full decade. Indeed, since the ETF was launched, the price of Bitcoin has increased by 93%, during which it has also experienced three corrections exceeding 20%.
I believe that for a long time to come, the market will maintain such return characteristics. The protracted struggle may not be as thrilling as the previous cycles of dramatic rises and falls, but it signifies that the cryptocurrency industry is undergoing a deeper transformation. When an asset class matures, the era of the protracted struggle has arrived.
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